Timber Centre Vs. Additional Commissioner of Commercial Taxes

Timber Centre vs Additional Commissioner of Commercial Taxes

Disposition Appeal allowed Court Karnataka Decided Mar 27, 2001

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Citation: sooperkanoon.com/387097
Court: Karnataka High Court
Judge: M.F. Saldanha and ;R. Gururajan, JJ.
Decided On: Mar 27, 2001
Case Number: S.T.A. No. 98 of 1996
Subject: Sales Tax
Disposition: Appeal allowed

Case Summary

AI-generated summary - not the official court judgment text.

- [A.V. Srinivasa Reddy, J.] When Order 8 Rule 11 CPC is to be adhered to -- HELD -- It is only where there is furnishing of a copy of the plaint or petition is made mandatory that the provision of Order 8 Rule 11 CPC could be adhered to. As there is no such provision on the Act or in the Rules, making it mand...

Key legal issue: Sales Tax
Outcome / disposition: Appeal allowed
Acts & sections: Karnataka Sales Tax Act, 1957 - Sections 22A; Karnataka Sales Tax Rules, 1957 - Rule 23B(1A)

Parties & Advocates

Appellant / Petitioner

Timber Centre

Advocate S.K. Nahar, Adv.

Respondent

Additional Commissioner of Commercial Taxes

Advocate B. Anand, AGA

Legal References

Acts: Karnataka Sales Tax Act, 1957 - Sections 22A; Karnataka Sales Tax Rules, 1957 - Rule 23B(1A)
Reported In: [2001]124STC49(Kar)

Excerpt

.....of the petitioner to serve a copy of the petition on the defendant along with notice, order 8 rule 11 cpc can have no application at all to a proceedings under the act. the order passed is without application of mind and in total disregard of the facts and circumstances of the case as also the provisions governing the procedure that ought to be mandatorily followed under the act. (b) karnataka rent act, 1999 (karnataka act no. 34/2001) - section 42 -- karnataka rent rules, 2001 -- rule 33 -- civil procedure code, 1908 ( central act no. 5 of 1908) --order 5 rule 2, order 8 rule 11 -- trial court took exception to the filing of the objection statement beyond the outer period prescribed in the civil procedure code and rejected it -- order of trial court set aside and applicability of section 42(1) of the act read with order 5 rule 2 and order 8 rule 11 cpc discussed. held: the impugned order prejudicially affects the right of the petitioners since he is estopped from meeting the case as pleaded by the respondent in her petition. in the absence of pleadings by the petitioner-tenant the court may well refuse to consider the oral evidence that maybe led by him in support of any defence that may be open to him. before passing such an order the court was duty-bound to call upon the petitioner in terms of section 42 (1) of the act to show cause why such an order should not be passed against him. it is quite regrettable that the court-below passed the order when the petitioner-tenant had not even taken a single adjournment for filing the objections. the order is passed overlooking sub-section(3) of section 42 which provides that a party is entitled to request and obtain three adjournments throughout the proceedings and the adjournments could be obtained at any stage of the proceedings. the order-sheet discloses that even this benefit had not been availed of by the petitioner-tenant for filing the statement as he had promptly filed it on the very next date of hearing...........that the general requirement of all cases, viz., that the goods be accompanied by supportive documents would hold good even in the present case. he submits that admittedly form no. 39 was not forthcoming and that therefore the restoration of the penalty order is fully justified. we need to draw a distinction as far as the present case is concerned between the generality of cases and the few wherein the defence is fully borne out by the documents produced. there is no doubt about the fact that the appellate authority has carefully scrutinised the documents produced which do establish the appellant's case, namely, that it was their own material which had been cut into pieces and was being retransmitted to his premises. in the special facts and circumstances, therefore, the appellant is on sound footing when he points out that there was no requirement of form no. 39 on the facts of the present case. we also uphold the second contention that has been put forward on the appellant's behalf, namely, that where a revisional authority interferes with a well-considered order and an order wherein the findings appear to be fully justified that there must be very strong, valid and cogent grounds, the reasoning set out and there should also be supportive material before the authority's interference is warranted. none of these ingredients are satisfied, the revisional order is a cryptic order which is totally bereft of any of these considerations. under the circumstances the revisional order is set aside. the appeal succeeds. the appellate order is restored. if the appellants have been required to pay the original penalty amount then they shall be entitled to pro rata refund.4. the appeal succeeds and stands disposed off. no order as to costs.

Full Judgment

M.F. Saldanha, J.

1. We have heard the appellant's learned advocate and the learned Government Advocate on merits. The controversy involved in this appeal again centers around the question as to whether the appellant was obliged to have carried form No. 39 along with the cut rose wood pieces that were found in the transport at the time when the goods were intercepted. The original authority imposed a heavy penalty of Rs. 59,701 on the appellant principally on this ground but also taking note of the fact that there was no proper mention of the relevant Karnataka sales tax numbers in the job-work documents that were produced. The appellant had filed an appeal and the appellate authority reduced the penalty to Rs. 2,000 principally because the authority after examination of the record accepted the appellant's contention which was again based on documents that the wood had been purchased from the Forest Department on which the appellants had paid the relevant and requisite sales tax and that it was these very logs that had been sent to the saw mill for being cut into pieces. The authority having been satisfied from the documents about the identity of the goods and the genuineness of the appellant's contention that there was no sale involved but that it was only a processing job, reduced the penalty to Rs. 2,000 only upholding the minor breach relating to the non-mention of the Karnataka sales tax numbers. However, the revisional authority and that too after a lapse of four years, set aside the appellate order and restored the original penalty order and it is against this last contention that the present appeal has been preferred.

2. The appellant's learned counsel has demonstrated to us that this is one of the few cases in which the appellate authority's order reflects a very careful and thorough consideration of the records and that the appellate authority has very correctly recorded the findings that the appellants were unjustifiably punished as far as the main charge is concerned. He has also submitted that this was a proceeding in which if the revisional authority desired to set aside the appellate order that justifiable grounds and material ought to have been set out which has not been done and that consequently the interference was thoroughly unjustified.

3. The learned Government Advocate submitted that the authorities are required to act on the safe side, that it is not desirable for them to accept the contention such as those taken up in the present case whereby the parties plead that the goods had only been processed and it is his submission that the general requirement of all cases, viz., that the goods be accompanied by supportive documents would hold good even in the present case. He submits that admittedly form No. 39 was not forthcoming and that therefore the restoration of the penalty order is fully justified. We need to draw a distinction as far as the present case is concerned between the generality of cases and the few wherein the defence is fully borne out by the documents produced. There is no doubt about the fact that the appellate authority has carefully scrutinised the documents produced which do establish the appellant's case, namely, that it was their own material which had been cut into pieces and was being retransmitted to his premises. In the special facts and circumstances, therefore, the appellant is on sound footing when he points out that there was no requirement of form No. 39 on the facts of the present case. We also uphold the second contention that has been put forward on the appellant's behalf, namely, that where a revisional authority interferes with a well-considered order and an order wherein the findings appear to be fully justified that there must be very strong, valid and cogent grounds, the reasoning set out and there should also be supportive material before the authority's interference is warranted. None of these ingredients are satisfied, the revisional order is a cryptic order which is totally bereft of any of these considerations. Under the circumstances the revisional order is set aside. The appeal succeeds. The appellate order is restored. If the appellants have been required to pay the original penalty amount then they shall be entitled to pro rata refund.

4. The appeal succeeds and stands disposed off. No order as to costs.

Same Court & Year Karnataka · 2001 Same Parties Timber Centre vs Additional Commissioner of Commercial Taxes Same Subject Sales Tax Same Judge M.F. Saldanha and ;R. Gururajan, JJ. Acts & Sections Karnataka Sales Tax Act, 1957 - Sections 22A; Karnataka Sales...

Sales Tax