Devi Dass Gopal Krishan Vs. the State of Punjab - Court Judgment

Rajendra Nath Mittal, J.

1. This reference has been made by the Sales Tax Tribunal under Sub-section (1) of Section 22 of the Punjab General Sales Tax Act, 1948 (hereinafter referred to as 'the Act').

2. The facts of this case briefly are that M/s. Devi Dass Gopal Krishan is a registered dealer under the Act and is carrying on the business of ginning of cotton and oil crushing at Moga, district Ferozepore. In the assessment year 1960-61, the assessee filed four returns of purchase tax payable for the quarters ending on 30th June, 1960, 30th September, 1960, 31st December, 1960 and 31st March, 1961, on 28th September, 1961, in which 'nil' was shown against all the columns, namely, 'A' to 'H'. Five notes were given at the end of the returns which are as follows:

(1) Extraction of oil from oil-seeds does not amount to manufacture.

(2) Imposition of purchase tax amounts to imposition of excise duty which could be levied by the Government of India only.

(3) Definition of purchase is defective.

(4) In the matter of purchase tax leave to appeal to the Supreme Court has been granted by the High Court of Punjab.

(5) Assessee is not liable to pay tax on purchase made through commission agents, as they are not his purchases.

3. Mr. K.K. Uppal, who was the Assessing Authority of Punjab (Enforcement Officer, Punjab), created an additional demand of Rs. 35,041.23 for the assessment year 1960-61 by his order dated 21st March, 1963. The assessee having felt aggrieved against the said order filed an appeal to the Deputy Excise and Taxation Commissioner, Jullundur Division, Jullundur, which was decided by him on 9th November, 1964, by which he remanded the case to the Assessing Authority to decide it afresh according to the observations made in the order. The case came up for decision before Shri Sarbjit Singh, Assessing Authority, Ferozepore, who issued fresh notice to the assessee on 29th July, 1965, for appearance before him on 16th August, 1965. He made the assessment, afresh and created an additional demand of Rs. 38,493.80 by his order dated 30th October, 1965. The assessee again filed an appeal before the Deputy Excise and Taxation Commissioner, Patiala Division, Patiala and urged before him as follows:

(i) that the assessment framed was time-barred ;

(ii) that the assessment was framed in spite of stay order of the Supreme Court;

(iii) that the transfer of goods from the head office to its branch have been wrongly taken to be the sales of the appellantfirm;

(iv) that the turnover for the purpose of levy of purchase tax had been incorrectly computed ;

(v) that the deductions claimed for the goods exported out of India had been wrongly disallowed;

(vi) that the sales tax has been wrongly levied on the sales of edible oils; and

(vii) that the computation of purchase turnover was wrong.

4. The Deputy Excise and Taxation Commissioner decided the appeal on 22nd September, 1966, whereby he remanded the case for fresh decision regarding the grounds mentioned at serial Nos. (iii) to (vii) and rejected it regarding the grounds mentioned at serial Nos. (i) and (ii). The assessee felt dissatisfied with the said order and filed a revision petition before the Excise and Taxation Commissioner, Punjab. Subsequently, on account of amendment in the Act, the Sales Tax Tribunal (hereinafter referred to as 'the Tribunal') were created, which were also empowered to decide pending revisions and appeals under Section 21B of the Act. The revision, therefore, stood transferred to the Tribunal for disposal. The Tribunal dismissed the revision petition on 30th July, 1968. A contention was raised before the Tribunal by the assessee that the returns on form S.T. VIII-A filed before the Assessing Authority impliedly showed that purchases were made by it but correct details of purchases, etc., had not been given in the columns of the returns and instead thereof 'nil' had been stated against each column and, therefore, they were no returns in the eye of law. The Tribunal-came to the conclusion that they were the returns which had been filed by the assessee and were not the cases of 'nil' returns. The next contention raised was that in view of no proper returns, the assessment could be made under Sub-section (5) of Section 11 of the Act as 'best judgment assessment'. This, however, could be done only within a period of three years from the date when the assessee should have furnished returns in respect of any period. In the present case, the assessment had been made by the Assessing Authority on 30th October, 1965 and, therefore, it was not within limitation. The next contention which had been urged was that Shri K.K. Uppal, who was the Assessing Authority of Punjab, had taken cognizance of the matter and had issued notice in form S.T. XIV under Sub-section (2) of Section 11 of the Act. It was contended that the said notice was bad in the eye of law as he was not the Assessing Authority before whom the returns were filed and he was not entrusted with the case specifically to deal with. The proceedings before him were, therefore, without jurisdiction and nullity. The subsequent proceedings which were started by Shri Sarbjit Singh, Assessing Authority, by issuing a notice on 16t;h August, 1965, were barred by time as the period of three years had elapsed which was prescribed under Sub-section (5) of Section 11 of the Act. The representative of the State, on the other side, contended that the assessee had submitted to the jurisdiction of Shri K.K. Uppal, who had the jurisdiction to make assessment throughout the State of Punjab. It was also contended that it was not a case of inherent lack of jurisdiction and such an objection could not be raised at the time of appeal. The Tribunal after considering the case law came to the conclusion that there was no want of jurisdiction in Shri K.K. Uppal and, at the most, it was an irregular assumption of jurisdiction against which no objection was raised by the assessee during the proceedings and, therefore, the order passed by Shri K.K. Uppal was not a nullity. It was further held that the irregularity in assumption of jurisdiction did not have any effect on the validity of order of assessment made by Shri K.K. Uppal especially when the assessee submitted to his jurisdiction and pleaded its case without any objection before him.

5. After the decision of the matter by the Tribunal, the assessee filed an application under Sub-section (1) of Section 21 of the Act before the Tribunal to refer certain questions of law to this court. The Tribunal after hearing the parties referred the following questions of law, vide its order dated 16th December, 1969, to this court:

(1) Whether in the facts and the circumstances of the case, the quarterly returns in form S.T. VIII-A filed by the petitioner without depositing the amount of tax and without indicating his gross taxable turnover were returns in the eye of law and could furnish a basis for proceedings under Section 11(2) of the Punjab General Sales Tax Act?

(2) Whether the order of the Assessing Authority dated 30th October, 1965, assessing purchase tax in the case without issuing a statutory notice under Section 11(5) of the Act was within limitation and sustainable in law ?

(3) Whether in the facts and circumstances of the case, the order of the Assessing Authority was within jurisdiction and legally sustainable ?

6. The first question which has been urged by the learned counsel for the assessee is that the returns which had been filed by his client were no returns in the eye of law. According to him, the returns do not disclose the requisite information which is required to be given under the Act and the Rules framed under the Act known as 'the Punjab General Sales Tax Rules, 1949' (hereinafter referred to as 'the Rules'). In these circumstances, he submitted that the returns cannot be considered to be valid returns. The learned counsel for the respondent has controverted the above position. According to him, the returns were filed by a proper person on a proper form. If he has not given the data required by the Rules, they can, at the most, be treated to be the returns which were not correct and complete as given in Sub-section (2) of Section 11 of the Act.

7. We have heard the learned counsel for the parties at length. Before dealing with this matter, it will be better to reproduce Sections 10 and 11 of the Act, which are as follows :

Section 10. Payment of tax and returns.-(1) Tax payable under this Act shall be paid in the manner hereinafter provided at such intervals as may be prescribed.

(2) The Commissioner may, in such circumstances and subject to such conditions as may be prescribed, accept from any dealer, in lieu of the amount of the general tax payable during any period, a lump sum by way of composition determined in the prescribed manner.

(3) Such dealers as may be required so to( do by the Assessing Authority by notice served in the prescribed manner and every registered dealer shall furnish such returns by such dates and to such authority as may be prescribed :

Provided that, if any dealer establishes to the satisfaction of the Assessing Authority that his average taxable turnover does not exceed ten per centum of his average gross turnover, the returns to be furnished by such dealer under this Sub-section shall be annual returns. (4) Before any registered dealer furnishes the returns required by Sub-section (2), he shall, in the prescribed manner, pay into a Government treasury or the Reserve Bank of India the full amount of tax due from him under this Act according to such returns and shall furnish along with the returns a receipt from such treasury or bank showing the payment of such amount.

(5) If any dealer discovers any omission or other error in any returns furnished by him, he may at any time before the date prescribed for the furnishing of the next return by him furnish a revised return and if the revised return shows a greater amount of tax to be due than was shown in the original return, it shall be accompanied by a receipt showing payment in the manner provided in Sub-section (3) of the extra amount.

(6) If a dealer fails without sufficient cause to comply with the requirements of the provisions of Sub-section (3) or Sub-section (4), the Commissioner or any person appointed to assist him under Sub-section (1) of Section 3 may, after giving such dealer a reasonable opportunity of being heard, direct him to pay, by way of penalty, a sum not exceeding one and a half times of the amount of tax which may be assessed on him under Section 11 in addition to the amount of tax assessed and where no tax is payable, a sum not exceeding one hundred rupees.

Section 11. Assessment of tax.-(1) If the Assessing Authority is satisfied without requiring the presence of registered dealer or the production by him of any evidence that the returns furnished in respect of any period are correct and complete, he shall assess the amount of tax due from the dealer on the basis of such returns.

(2) If the Assessing Authority is not satisfied without requiring the presence of registered dealer who furnished the returns or production of evidence that the returns furnished in respect of any period are correct and complete, he shall serve on such dealer a notice in the prescribed manner requiring him on a date and at a place specified therein, either to attend in person or to produce or to cause to be produced any evidence on which such dealer may rely in support of such returns.

(3) On the day specified in the notice or as soon afterwards as may be, the Assessing Authority shall, after hearing such evidence as the dealer may produce and such other evidence as the Assessing Authority may require on specified points, assess the amount of tax due from the dealer.

(4) If a registered dealer, having furnished returns in respect of a period, fails to comply with the terms of a notice issued under Sub-section (2), the Assessing Authority shall within three years after the expiry of such period, proceed to assess to the best of his judgment the amount of the tax due from the dealer.

(5) If a registered dealer does not furnish returns in respect of any period by the prescribed date, the Assessing Authority shall within three years after the expiry of such period, after giving the dealer a reasonable opportunity of being heard, proceed to assess to the best of his judgment, the amount of tax, if any, due from the dealer.

(6) * * *(7) The amount of tax-

(a) due where the returns are furnished without receipt showing full payment thereof, or

(b) assessed under Sub-sections (1), (3), (4) and (5), less the sum, if any, already paid by the dealer in respect of the said period, or

(c) assessed under Sub-section (6) together with the penalty directed to be paid under that Sub-section,

shall be paid by the dealer into a Government treasury or the Reserve Bank of India. by such date as may be specified in a notice issued by the Assessing Authority for this purpose and the date to be so specified shall be not less than thirty days from the date of service of such notice:Provided that the Assessing Authority may, in respect of any particular dealer and for reasons to be recorded in writing, extend the date of such payment or allow such dealer to pay the tax due and the penalty, if any, by instalments.

8. The relevant rules which deal with the filing of the returns are incorporated from Rule 17 onwards. Rules 20 and 25 are the relevant rules for filing the returns of purchase tax and these are as follows:

Rule 20. Every registered dealer, other than those referred to in Rules 17, 18 and 19, shall furnish returns in form S.T. VIII or S.T. VIII-A or S.T. XXIII, as the case may be, quarterly within thirty days from the expiry of each quarter.

Rule 25. All returns in form S.T. VIII or S.T. VIII-A or S.T. XXIII, as the case may be, which are required to be furnished under these rules, shall be signed by the registered dealer or his agent and shall be sent to the appropriate Assessing Authority or the Taxation Sub- Inspectors posted for sales tax work at places other than the district headquarters, together with the treasury or bank receipt in proof of payment of the tax due.

9. Sub-section (1) of Section 10 of the Act provided that the tax payable under the Act shall be paid in the manner provided in subsequent Sub-sections and Sub-section (3) states that every registered dealer shall furnish returns by such dates and to such authority as may be prescribed. Under Sub-section (4) a registered dealer is required to deposit in the Government treasury or the Reserve Bank of India the full amount of tax due from him under the Act, according to the returns filed by him and he shall furnish along with the returns, the receipt from such treasury or bank showing the payment of amount. Under Sub-section (5), the dealer has been given a right to furnish a revised return before the date prescribed for the furnishing of the next return, in case he discovers any omission or other error in the return submitted by him. Sub-section (6) states that if the dealer fails without sufficient reason to comply with the requirements of Sub-sections (3) and (4), the Commissioner or any person appointed to assist him after giving such dealer a reasonable opportunity of being heard, direct him to pay penalty. Sub-section (2) of Section 11 says that if the Assessing Authority is not satisfied, without requiring the presence of dealer to furnish the returns that such returns are correct and complete, he shall serve on such dealer a notice in the prescribed manner requiring him, on a date and place specified therein, either to attend in person or to produce any evidence on which the dealer may rely in support of his returns. Rule 33 of the Rules prescribes the form in which the notice is to be issued by the appropriate authority. Sub-section (3) of Section 11 authorises the Assessing Authority to hear the dealer and assess the amount of tax due from him. In case, the dealer fails to comply with the notice issued under Sub-section (2), the Assessing Authority has been authorised under Sub-section (4) to proceed to assess to the best of his judgment the amount of tax due from such dealer within a period of three years. If the dealer does not furnish returns in respect of any period by the prescribed date, the Assessing Authority has been given power to assess such dealer to the best of his judgment within a period of three years after the expiry of such period after giving a reasonable opportunity to him of being heard.

10. From a perusal of the aforesaid Sub-sections of Sections 10 and 11, the scheme of the Act appears to be that if the registered dealer furnishes the returns and the Assessing Authority takes them to be bona fide ones, he has to proceed for assessment either under Sub-section (1) of Section 11 if he finds them to be correct and complete and shall assess the amount of tax due from such dealer on the basis of the returns. If the Assessing Authority is, however, not satisfied that the returns are correct, he shall serve the notice on the dealer and then proceed with the assessment under Sub-sections (2) and (3) of Section 11 of the Act. If the dealer does not furnish the returns in respect of any period by the prescribed date, the Assessing Authority has to proceed for best judgment assessment within a period of three years from the prescribed date. The scheme thus clearly shows that in case of incomplete and incorrect returns, the Assessing Authority has to proceed in the way prescribed in Sub-sections (2) and (3) of Section 11 and where it is a case of nonfiling of the returns, he has to proceed under Sub-section (5) of the said section. In this case, all the columns of the returns have been filled as 'nil'. The note which has been appended to the returns shows that the dealer had his own reasons for filing the returns in that way. It is immaterial whether the reasons given by him are correct or incorrect. We have to interpret the returns from the language which has been used by him. Note five on the returns shows that the assessee has given the reason for showing the purchase price paid as 'nil' as he claimed to have made the purchases through commission agents. There has been a controversy as to whether purchases made by a dealer through the commission agents are to be treated as purchases made by him. No doubt, the words used in the note are not very happy as he does not specifically state that he had purchased the goods through the commission agents and he was, therefore, not liable to pay the tax, but by implication the note seems to be so. There has also been a controversy whether the extraction of oil amounts to manufacture of goods or not. On the whole, the reading of the five notes appended to the returns shows that he was asserting that he was under a belief that he was filing the returns bona fide and was not liable to pay tax on the purchases for the reasons which have been given in the notes. The learned counsel has laid a great stress that in the notes the assessee challenged the vires of the definition of 'purchase' and also the provisions of the Act, which shows that he was not interested in disclosing any information. According to him, the reasons do not help the assessee in not disclosing the information which is required to be given in the form. He has specifically drawn our attention to Clause 'A' in the form which is in the following terms :

Purchase price paid and payable for goods purchased during the return period for use in the manufacture of goods for sale.

11. We are not convinced by the said argument. In case the assessee wanted that these returns should be treated as no returns, he should have not appended the notes. In the alternative, he could have sent only a letter containing his grounds for not filing the returns. The form also contains a declaration which shows that whatever he has stated in the form was true and complete to the best of his knowledge and belief. The making of a declaration also proves the bona fides of the assessee in filing the returns in form S.T. VIII-A. The assessee at a subsequent stage after filing the returns cannot in view of the above facts be allowed to turn round and say that the returns filed by him were no returns. The reading of Sub-section (2) of Section 11 of the Act shows that it authorises the Assessing Authority to serve notices on the assessee if he was not satisfied regarding the correctness and completeness of the returns and in that eventuality the assessee shall be assessed after hearing such evidence as he wanted to produce and such other evidence as the Assessing Authority requires on specific points. In other words, if the returns are incorrect and incomplete, the Assessing Authority shall proceed under Sub-section (3) read with Sub-section (2) of Section 11. In order to find out whether the present returns are not complete returns or they are incomplete returns, we may see the meanings of the word 'incomplete'. The word 'incomplete' has been defined as 'not fully formed, made, or done; not whole or thorough' in the Shorter Oxford Dictionary, 1968, Third Edition, at page 981. According to Webster's Third New International Dictionary, 1966 Edition, the word 'incomplete' has been defined at page 1144 to mean 'unfinished, imperfected'. The word 'incorrect' has been defined in the same edition of the Shorter Oxford Dictionary as 'erroneous, inaccurate' at page 984 and it has been defined at page 1145 in the same edition of Webster's Dictionary as 'not correct or chastened'.

12. According to the dictionary meaning as well, the returns are either imperfect or not thorough. In our view, the returns can, therefore, be said to be incomplete as the writing of the word 'nil' shows that they have not been perfected by giving complete information. They can also be said to be incorrect as the information given in column 1 and the sub-sequent columns shows that no purchase had been made which is contrary to facts.

13. Faced with this situation, the learned counsel for the assessee has submitted that assuming the returns could be treated as incomplete and incorrect but the cases of no returns cannot be treated as incomplete or incorrect returns. In support of his argument, he has referred to Sub-section (5) of Section 11 of the Act. He submits that in the case of no returns, the assessee can be dealt with under the said section within a period of three years from the date prescribed for filing the returns. We have also not been able to appreciate this argument of the learned counsel for the assessee. The case of no returns stand on a different footing than that of incomplete and incorrect returns. In such a case, the returns should not have been filed or the columns should not have been filled at all. In the present reference, this is not the case.

14. The learned counsel for the assessee has relied on Abhey Ram Chunni Lal, In re [1933] 1 I.T.R. 126 in support of his argument. The facts of that case were that the assessee had his business at three places, namely, Benares, Jaunpur and Piparia with head office at Benares. The Income-tax Officer of Benares called for a return, of his total income including the income from Jaunpur and Piparia offices. The assessee filed a return in regard to Benares office alone and did not file the return of income from the other two offices in spite of extension of time by the Income-tax Officer. In these circumstances, the High Court held that the return made was not a return under Sub-section (2) of Section 22 as it was not a return of the total income and the Income-tax Officer was justified in making a summary assessment under Sub-section (4) of Section 23. After the above observations, the learned Bench also observed that when an assessee had made a return which he knew that it was bona fide return and in which he had put in his total income, to the best of his then information, there might yet be some omission on his part due to some cause or other ; in that and similar cases Section 23(2) would apply. The view taken by the learned Bench clearly shows that it was held to be no return by the Bench on the facts of that case. The subsequent observations clearly show that if the return was bona fide it was a good return even though full income had not been given therein. In the aforesaid circumstances, we do not find that the assessee can take any benefit from the said case. He has then referred to Khas Kajore Coal Co. Limited v. Member, Board of Revenue [1966] 18 S.T.C. 79, in support of his contention. In that case, the return was filed without the receipt of the bank in proof of the deposit of the sales tax collected by the assessee. After perusing the various sections, the learned Judges of the Calcutta High Court observed that it was a case of no return. It is again a case which is distinguishable from the present one. The deposit of the amount is mandatory before the filing of the return. In these circumstances, we are of the view that he cannot derive any benefit from the said case. We have already held above that the assessee filed the returns before the Assessing Authority though these might be incomplete or incorrect ones.

15. The next question which has been urged by the learned counsel for the assessee is that Shri K.K. Uppal, who passed the original order, had no jurisdiction either to take cognizance of the matter or to pass any order. He has also challenged the notice in form S.T. XIV issued by Shri K.K. Uppal. His next contention is that if Shri K.K. Uppal had no jurisdiction to take cognizance of the matter and to issue notice under form S.T. XIV, then the order passed by Sarbjit Singh on 30th October, 1965, is also without jurisdiction. In order to show as to whether Shri K.K. Uppal had jurisdiction, he has drawn our attention to various sections of the Act and the rules of the Rules. First of all, it will be better if the various sections and rules which have been referred to, are noticed as hereunder :

SECTIONS

2. (a) 'Assessing Authority' means any person authorised by the State Government to make any assessment under the Act.

2. (f) 'Prescribed' means prescribed by rules made under the Act.

2. (ff) 'Purchase' with all its grammatical variations or cognate expressions, means the acquisition of goods specified in Schedule 'C for cash or deferred payment or other valuable consideration otherwise than under a mortgage, hypothecation, charge or pledge.

2. (j) 'Year' means the financial year.

3. Taxing authorities.-(1) For carrying out the purposes of this Act, the State Government may appoint a person to be Excise and Taxation Commissioner and such other persons to assist him as it thinks fit.

RULES

2. (b) 'Appropriate Assessing Authority' in respect of any particular dealer means the Excise and Taxation Officer or the Assistant Excise and Taxation Officer, within whose jurisdiction the dealer's place of business is situated, or if the dealer has more than one place of business in Punjab, the Excise and Taxation Officer or the Assistant Excise and Taxation Officer within whose jurisdiction the head office in Punjab of such business is situated or such other person as may be appointed under Section 3 of the Act and authorised by the State Government to make assessment in respect of such dealer within the meaning of Clause (a) of Section 2 of the Act.

2. (g) 'Excise and Taxation Officer' means the person appointed by that designation by the State Government under Section 3 of the Act to assist the Commissioner.

33. When it appears to the appropriate Assessing Authority to be necessary to make an assessment under Section 11 in respect of a dealer, he shall serve a notice in form S.T. XIV upon him-

(a) calling upon him to produce his books of account and other documents, which such authority wishes to examine together with any objection which the dealer may wish to prefer and any evidence which he may wish to produce in support thereof ; and

(b) stating the period or the return period or periods in respect of which assessment is proposed;

and he shall fix a date ordinarily not less than 10 days after the date of the service of the notice for producing such accounts and documents and for considering any objection which the dealer may prefer.

34. The Assessing Authority may depute an Inspector, who has been authorised in this behalf, to hear the dealer's objection and to record any evidence brought in support thereof.

38. (1) An Excise and Taxation Officer and an Assistant Excise and Taxation Officer incharge of a district shall exercise the powers of Assessing Authority in relation to all dealers within his territorial jurisdiction.

(2) An Assistant Excise and Taxation Officer, when appointed to assist an Excise and Taxation Officer shall exercise the powers of Assessing Authority in relation to dealer within his territorial jurisdiction whose gross turnover does not exceed Rs. 5,00,000.

39. An Excise and Taxation Officer may, by an order in writing, transfer a case from the file of an Assistant Excise and Taxation Officer, serving in his district, to his own file and vice versa or to the file of another Assistant Excise and Taxation Officer serving in his district subject to the pecuniary jurisdiction prescribed in Sub-rule (2) of Rule 38.

16. The learned counsel has then submitted that the returns in this case were filed before the Excise and Taxation Officer, Ferozepore and he was the only appropriate Assessing Authority who could take any action under the Act. There is no order by which the said proceedings have been transferred from the appropriate Assessing Authority, Ferozepore, to Shri K.K. Uppal. In the circumstances, according to his submissions, Shri K.K. Uppal had no jurisdiction to take cognizance of the matter. On the other hand, the learned counsel for the respondent has submitted that Shri K.K. Uppal was an Excise and Taxation Officer for the whole of the State of Punjab and, as such, there was no bar why he could not take cognizance of this matter. He has referred to the definition of 'appropriate Assessing Authority' in Sub-rule (b) of Rule 2 of the Rules where it is mentioned that it includes 'any person' as may be appointed under Section 3 of the Act and authorised by the State Government to make assessment in respect of such dealer within the meaning of Clause (a) of Section 2 of the Act. In these circumstances, he urged that Shri K.K. Uppal had the jurisdiction to decide this matter. Secondly, he submits that the objection which is being raised now was never raised by him either before Shri K.K. Uppal, the Assessing Authority, or before Shri Sarbjit Singh, who decided the matter after remand on 30th October, 1965. The matter was raised for the first time before the Deputy Excise and Taxation Commissioner in appeal. It is urged that the assessee cannot be allowed to raise the objection for the first time before the Deputy Excise and Taxation Commissioner when he had submitted to the jurisdiction of Shri K.K. Uppal and Shri Sarbjit Singh.

17. We have heard the learned counsel for the parties at length. The appropriate Assessing Authority has been defined as such Excise and Taxation Officer or the Assistant Excise and Taxation Officer, within whose jurisdiction the dealer's place of business is situated or such other person as may be appointed under Section 3 of the Act and authorised by the State Government to make assessment in respect of such dealer within the meaning of Clause (a) of Section 2 of the Act. Shri K.K. Uppal had admittedly been appointed under Section 3 of the Act as Excise and Taxation Officer for whole of the State of Punjab and authorised by the State Government to act as the Assessing Authority under Section 2(a) and to make the assessment. The notification by which he was appointed is as follows:

No. S. 0. 242/P.A. 46/48IS-3I63 dated June 11, 1963.-In exercise of the powers conferred by Sub-sections (1) and (2) of Section 3 read with Clause (a) of Section 2 of the Punjab General Sales Tax Act, 1948, the Governor of Punjab is pleased to appoint the Excise and Taxation Officer, Finance Department, to assist the Excise and Taxation Commissioner, Punjab and to authorise him to make any assessment under the said Act within the whole of the State of Punjab.

18. The reading of the notification along with the definition of 'appropriate Assessing Authority' clearly shows that Shri K.K. Uppal had the jurisdiction to make the assessment. We are, therefore, of the opinion that he was the appropriate Assessing Authority as defined in Clause (b) of Rule 2 of the Rules.

19. The next question that arises in the case is whether Shri K.K. Uppal could take cognizance of this matter unless the case was transferred to his file. The second question that has been raised is whether in the absence of any specific rule, any authority could transfer the case from the file of the Assessing Authority, Ferozepore, to his file. It will be appropriate to first see whether any authority had jurisdiction to transfer the case from the file of one Assessing Authority to the file of another Assessing Authority. Rule 39 of the Rules says that the Excise and Taxation Officer incharge of a district may suo motu or on an application made to him in this behalf, transfer any case from the file of an Additional Excise and Taxation Officer or Assistant Excise and Taxation Officer serving in his district to his own file and vice versa or to the file of another Excise and Taxation Officer serving in his district, subject to the pecuniary jurisdiction prescribed. Shri K.K. Uppal will be considered to be an Additional Excise and Taxation Officer for the purpose of the assessee and the Excise and Taxation Officer could transfer the case of the assessee to the file of the Additional Excise and Taxation Officer. Rule 39 is explicit and no other inference can be drawn from it except the one given above. Rule 69 of the Rules states that the Commissioner shall superintend the administration and the collection of tax leviable under the Act and shall control all officers empowered thereunder. The power to superintend, in our view, also gives him the power to transfer proceedings from one Assessing Authority to another Assessing Authority. In this view, we are supported by a Division Bench decision of this Court in Kishan Chand & Co. v. S.K. Jain [1965] 16 S.T.C. 521, wherein it has been observed as follows :

Although there is no provision in the Punjab General Sales Tax Act, 1948, specifically empowering transfer of pending proceedings, the power to transfer must be held to be inherent and implicit in the Excise and Taxation Commissioner, who is the final controlling authority and is empowered to superintend the administration and the collection of the leviable tax. The exercise of this discretionary power is sufficiently guided and controlled by the statutory purpose to be achieved by the statute, viz., the convenient and efficient assessment and collection of the tax, consistent with the reasonable convenience of the particular dealer.

20. Mr. Garg has challenged this proposition and laid great emphasis that unless there is specific power of transfer given to a particular officer, he cannot exercise such powers. According to his contention, the right of transfer is not an inherent right but can be conferred by a statute only. Unless the statute confers that right on any person, the proceedings cannot be transferred from one Assessing Authority to another Assessing Authority. In support of his proposition, he has relied on Sukhdev Singh v. Honourable C. J., S. Teja Singh and the Honourable Judges of the Pepsu High Court at Patiala A.I.R. 1954 S.C. 186. In that case, the proceedings were initiated by the two Judges of the Pepsu High Court for contempt under the Contempt of Courts Act and they were being tried by those very Judges. An application was made in the Supreme Court for transfer of those contempt proceedings to some other High Court. Their Lordships of the Supreme Court dismissed the petition observing that they had no power to order a transfer in an original petition of that kind, but they consider it desirable on the general principles of justice that a Judge who had been personally attacked should not so far as possible hear contempt matter which, to that extent, concerns him personally. The application was made under Section 527 of the Code of Criminal Procedure. Their Lordships held that the power of a High Court to institute proceedings for contempt of court and punish where necessary was a special jurisdiction which is inherent in all courts of record and Section 1(2) of the Code of Criminal Procedure expressly excludes special jurisdiction from its scope. The observations were made in that context. So the abovesaid case is distinguishable from the present case and the assessee cannot take any benefit from those observations. He has then referred to Bidi Supply Co. v. Union of India and Ors. [1956] 29 I.T.R. 717 (S.C.). In that case, the assessment proceedings relating to the years 1950-51, 1951-52, 1952-53, 1953-54 and 1954-55 were pending before the Income-tax Officer, District III, Calcutta. He had also made the assessments for the years 1948-49 and 1949-50. An order was passed by the Central Board of Revenue under Sub-section (7-A) of Section 5 of the Income-tax Act of 1922 that the Board transfers the case of Bidi Supply Co. to the Income-tax Officer, Special Circle, Ranchi. This order was challenged by the petitioner under Article 32 of the Constitution praying for an appropriate writ and order restraining the Income-tax Officer, Special Ward, Ranchi, from taking up any proceeding with the assessment of the petitioner to income-tax and other ancillary reliefs. While dealing with that case, their Lordships of the Supreme Court observed that the omnibus order in the case was not contemplated or sanctioned by Sub-section (7-A) and, therefore, the petitioner was still entitled to the benefit of the provisions of Sub-sections (1) and (2) of Section 64 of the Act. From this, the learned counsel for the assessee wants us to infer that no transfer can be made unless there was a specific provision to that effect. In our view, the observations of the Supreme Court do not help the learned counsel. We cannot infer by reading of the section and this authority that the powers of transfer cannot be exercised unless they have been specifically given to some person or Tribunal. In case the specific powers have not been given and there is general powers of superintendence, the person in whom such powers are vested, can transfer the proceedings from one Assessing Authority to another. The learned counsel also referred to Pannalal Binjraj and Ors. v. Union of India and Ors. [1957] 31 I.T.R. 565 (S.C.). In that case, their Lordships observed that none of the petitioners raised any objection to their cases being transferred in the manner stated in that case and in fact submitted to the jurisdiction of Income-tax Officers to whom their cases had been transferred. It was only after the decision of Bidi Supply Co.'s case [1956] 29 I.T.R. 717 (S.C.) was pronounced that they woke up and asserted their alleged rights. It is further observed that if they acquiesced in the jurisdiction of the Income-tax Officers to whom their cases were transferred, they were not entitled to invoke the jurisdiction of the Supreme Court under Article 32 of the Constitution. It is also observed that such conduct of the petitioners would disentitle them to any relief at the hands of that court. The observations clearly show that the objection at a subsequent stage regarding the transference of the proceedings cannot be agitated if the assessees had already submitted to the jurisdiction of the transferee-Income-tax Officer. In our opinion, this case is also of no help to the assessee.

21. We are thus of the opinion that the proceedings could be transferred from one Assessing Authority to another by the Commissioner in spite of the fact that there was no specific power vested in him (the Commissioner) to transfer the cases. The case could also be transferred from the Assessing Authority under Rule 39.

22. Now, we take up the question already stated above, namely, whether Shri K.K. Uppal could take cognizance of this matter without any specific order of transfer. In the first instance, the contention of the learned counsel for the respondent-State is that the said authority as an appropriate authority had the jurisdiction to make an assessment and the mere fact that no specific order of transfer had been made, does not take away the jurisdiction of that authority. He has also submitted that in case the assessee does not raise such an objection at the earliest, it cannot be done at a subsequent stage. In support of his contention, the learned counsel for the State has submitted that in order to determine the jurisdiction, Sections 2(c) and 3 have to be taken into consideration. He has also referred to Clause (b) of Rule 2 and submits that the authorities mentioned therein have got concurrent jurisdiction to make the assessment. It is not necessary, according to him, that the order should be posted for transfer of the proceedings from one authority to another. A similar question arose before a Division Bench of this Court in Kishan Chand & Co. v. S.K. Jain [1965] 16 S.T.C. 521. The facts of the case have already been stated above. In the writ proceedings for quashing the notice issued by the Assessing Authority, Punjab, Chandigarh, the writ was filed under Articles 226 and 227 of the Constitution of India. The Bench quashed that notice and observed as follows :

We do not mean and of course we do not hold, that an assessment made by the respondent in respect of a dealer whose place of business is at Amritsar would be open to be struck down as invalid for want of inherent jurisdiction and this, not even if the assessment proceedings had properly been commenced before the Assessing Authority functioning at Amritsar, nor do we hold that an irregular manner of seizing of an assessment proceedings would by itself attract jurisdictional infirmity necessarily vitiating a final assessment order. All that we hold in the instant case is that without a proper order transferring assessment proceedings completely from the file of the appropriate Assessing Authority actually seized of the present assessment proceedings at Amritsar, to the record of the respondent at Chandigarh, on a proper consideration of both the exigencies of tax collection and inconvenience to be caused to the assessee, the respondent's action is operating to the serious prejudice of the petitioner's rights and the respondent should be restrained from so acting. In our opinion there should be a proper precise lawful order, transferring the petitioner's assessment proceedings from the record of the appropriate Assessing Authority actually seized of the matter, by which he would be bound, to that of the respondent.

23. The Bench further observed that it would, of course, be open to the Commissioner to pass an appropriate order of transfer in accordance with law. It is further observed that it was desirable that some precise rules in regard to the transfer of pending assessments were made under the statute so as to facilitate proper and convenient assessment and collection of tax consistently with the convenience of the dealer. The perusal of the abovesaid para shows that the learned Bench observed that it was desirable that the order of transfer should have been made. The Bench simultaneously observed that an irregular manner of seizing of assessment proceedings would not by itself attract jurisdictional infirmity necessarily vitiating a final assessment order. The next case relied upon by the learned counsel for the State is Kishan Chand & Co. v. K.K. Opal, Excise & Taxation Officer (Enforcement), Amritsar [1966] 18 S.T.C. 50 which was also filed by the same Kishan Chand & Co. In that case, the Excise and Taxation Officer, Chandigarh, Shri S. K. Jain, sent to the petitioner notices in form S.T. XIV for the years 1961-62 and 1962-63 under the Act requiring it to appear before him on 3rd March, 1964. The notices issued were challenged by the company and were quashed by this court in the case reported as Kishan Chand & Co. v. S.K. Jain [1965] 16 S.T.C. 521. Secondly, Shri K.K. Opal required the petitioner to produce before him certain books of account for the years 1961-62 and 1962-63 along with certain other documents. It was also required to produce account books for the year 1963-64 along with certain other documents. It filed a petition under Article 226 challenging these notices and contended that the Assessing Authority issuing the notice had no jurisdiction to do so and only the Assessing Authority at Amritsar was competent to deal with the petitioner and issue the notices. The learned counsel in the said case relied on the concession of the learned counsel for the petitioner, which is to the effect that Shri K.K. Opal did not lack inherent jurisdiction to deal with the matter. He has then relied on the following observation of the Bench in the case reported as Kishan Chand & Co. v. K.K. Opal, Excise and Taxation Officer, (Enforcement), Amritsar [1966] 18 S.T.C. 50:

I am not unmindful of the difficulties of the revenue in making assessment and realising taxes from those dealers who do not frankly and honestly cooperate with the Assessing Authorities. I am, however, also conscious of genuine inconvenience to which a dealer may be put, when he is called upon to appear before one officer today and before another tomorrow in respect of the same assessment proceedings, even though both the officers may be possessed of inherent jurisdiction.

24. The learned Bench at the end on the concession of the learned counsel for the State observed as follows:

Now the policy of the department, as suggested by Shri Nehra, is to pass orders of transfer in all pending assessments before a dealer is required to appear before another Assessing Authority. Shri Nehra, who has plainly stated that the petitioner-assessee was suspected by the department to be taking steps to evade legitimate taxes and that is why the impugned notices were issued, has also agreed that he would have proper orders of transfer made in these cases. It would in the circumstances serve the ends of justice if we direct the respondent to proceed further on these notices only after securing necessary orders of transfer and we direct accordingly.

25. The main judgment was written by Dua, J. (as his Lordship then was), who was also a party to the earlier Division Bench judgment. The learned counsel for the State submits that it was not held in this case that the Assessing Authority had no jurisdiction to decide the matter. On the other hand, the learned counsel for the assessee submits that it is in line with the arguments advanced by him and the Bench considered it necessary that the proceedings should be transferred from the Assessing Authority who had originally the jurisdiction to make the assessment to the one who had taken cognizance of the matter. That case was, however, decided on its peculiar facts. The notice was challenged as soon as it was issued by Shri K.K. Opal. We do not find that this case helps the assessee in any way. There are specifically no observations in the case that the Assessing Authority could not take cognizance of the matter without an order of transfer. Mr. Siri Chand Goyal has also referred to Kishan Chand & Co. v. N.L. Murgai, Excise and Taxation Officer, Amritsar [1966] 18 S.T.C. 110 which is again a case of the same Kishan Chand and Company. This also relates to the returns for the year 1961-62 which were filed with the Assessing Authority, Amritsar. Subsequently, Shri S.K. Jain, issued notice under Sub-section (2) of Section 11 of the Act for that year. The petitioner challenged his jurisdiction in the High Court. The Joint Excise and Taxation Commissioner, Punjab, informed the petitioner by notice dated 23rd March, 1965, that the assessment proceedings would be taken up and finalised by Shri D.P. Gupta, Assessing Authority. On 10th June, 1965, the petitioner was served with a notice by Shri N. L. Murgai, Excise and Taxation Officer, Amritsar, in form S.T. XIV for his appearance with the account books for the year 1961-62. The petitioner then questioned the jurisdiction of Shri Murgai, who overruled the objection and proceeded to make an assessment. The petitioner then filed a petition under Articles 226 and 227 of the Constitution of India contending that the proceedings having been transferred to Mr. Gupta no other officer except Mr. Gupta could proceed with the assessment proceedings without any formal order of transfer by the Joint Excise and Taxation Commissioner. The Bench consisting of S.B. Capoor and I.D. Dua, JJ., observed that the submission on behalf of the petitioner that Shri N. L. Murgai had no jurisdiction to proceed with the assessment was wholly misconceived and was not supported by the earlier Bench decision of this Court in Kishan Chand & Co. v. S.K. Jain [1965] 16 S.T.C. 521. It was also observed that there was neither any jurisdictional nor any other similar grave legal infirmity disclosed on the record ; nor was there any manifest injustice done to the petitioner in consequence thereof, which would justify interference by the High Court. In Central Potteries Ltd., Nagpur v. State of Maharashtra and Ors. [1962] 13 S.T.C. 472 (S.C.), it has been observed by their Lordships of the Supreme Court as under:

There is a fundamental distinction between want of jurisdiction and irregular assumption of jurisdiction and that whereas an order passed by an authority with respect to a matter over which it has no jurisdiction is a nullity and is open to collateral attack, an order passed by an authority which has jurisdiction over the matter, but has assumed it otherwise than in the mode prescribed by law, is not a nullity. It may be liable to be questioned in those very proceedings, but subject to that it is good and not open to collateral attack.

26. In Davinder Singh and Anr. v. The Deputy Secretary-cum-Settlement Commissioner, Rural Rehabilitation Department, Jullundur [1964] 66 P.L.R. 555, the following observations were made by the Full Bench:

That total want of jurisdiction is an infirmity which is fatal to the proceedings and no amount of consent can cure it. There is also a distinction between want of inherent jurisdiction and irregular exercise or assumption of jurisdiction and while consent cannot clothe a Tribunal with jurisdiction where none exists, irregular exercise or assumption of jurisdiction can always be waived.

27. The above matter has also been considered by a single Judge of this court in Rex Hosiery Factory v. S.K. Jain and Anr. [1966] 18 S.T.C. 247. The firm in that case was carrying on business at Ludhiana and filed its returns with the Assessing Authority of that place for the year 1962-63. The petitioner received notice from Shri K.S. Jaspal (Finance Department), at Chandigarh, to appear before him for assessment. Shri K.S. Jaspal was subsequently succeeded by Shri S. K. Jain. Shri Jain assessed the petitioner to tax and also imposed a penalty on him under Sub-section (7) of Section 10 of the Act. He filed a writ petition in this court in which he challenged that Shri Jain was not competent to deal with his assessment in the absence of an order of transfer to him by the competent authority and the imposition of penalty under Sub-section (7) of Section 10 was illegal. It was held that the assessment made by him having jurisdiction throughout the State of Punjab would not become void merely because no order transferring the proceedings was made by the competent authority. We are in agreement with the view of the learned single Judge. The facts of the abovesaid case are almost similar to those of the present one.

28. The learned counsel for the assessee has submitted that the proceedings had not been transferred by a competent authority to Shri K.K. Uppal and he could not, therefore, issue a notice in form S.T. XIV. In support of his contention, the learned counsel relied on a Privy Council case in Maharajah of Bobbili v. Narasaraju Pede Baliara Simhulu Bahadur (1916) I.L.R. 39 Mad. 640 (P.C.). The question in that case was different than the one in the present case. Their Lordships of the Privy Council were interpreting Article 182 of Schedule I of the Limitation Act, 1908, wherein the words 'proper court' had been used. The said article was to be interpreted in conjunction with Sections 38, 39 and 41 of the Code of Civil Procedure. The question was that if the execution proceedings had been transferred from the court, who passed the decree to some other court for executing the decree and non-satisfaction certificate had not been received back, whether the application for execution to the court which passed the decree would be considered to be an application before a proper court. The observations, in our opinion, of their Lordships of the Judicial Committee were in a different context. The various sections of the Code of Civil Procedure were being interpreted by their Lordships. We do not find that the observations in the abovesaid circumstances can be of any help to the assessee in this case. He has also referred to Jateendrakumar Das v. Mahendrachandra Banikya (1933) I.L.R. 60 Cal. 1176, Rulia Ram and Anr. v. Diwan Chand and Ors. I.L.R. (1935) Lah. 16 and Jugal Kishore Debi v. Baidya Nath Roy (1928) I.L.R. 55 Cal. 608 which are also under Article 182 of the Limitation Act read with Sections 38 and 39 of the Code of Civil Procedure. They, on the basis of the above reasoning, are of no help to the assessee.

29. The learned counsel for the assessee has also drawn our attention to Rule 39-C which has been added in February, 1971, by which power of transfer of cases has specifically been given to the Commissioner. His contention is that now the Government has made the amendment in the Rules and has given powers of transfer of cases which shows that earlier the transfer could not be made as there was no rule to that effect. We have not been able to persuade ourselves to agree to this contention of the learned counsel for the assessee. We have already observed above that the power of superintendence was given to the Commissioner under Rule 69 of the Rules and that power also included the power of transfer. This contention of the learned counsel for the assessee also does not hold good.

30. The learned counsel for the State has also urged that the objection regarding jurisdiction of Shri K.K. Uppal, if any, should have been raised before him at the time when the assessee appeared before him for the first time. In case, he did not raise the objection, he cannot raise it subsequently in appeal or in revision before the higher authorities. He has also relied on the following observations of their Lordships of the Supreme Court in Pannalal Binjraj and Others' case [1957] 31 I.T.R. 565 (S.C.):

There is moreover another feature, which is common to both these groups and it is that none of the petitioners raised any objection to their cases being transferred in the manner stated above and in fact submitted to the jurisdiction of the Income-tax Officers to whom their cases had been transferred. It was only after our decision in Bidi Supply Co. v. The Union of India [1956] 29 I.T.R. 717 (S.C.) was pronounced on 20th March, 1956, that these petitioners woke up and asserted their alleged rights, the Amritsar group on 20th April, 1956 and the Raichur group on 5th November, 1956. If they acquiesced in the jurisdiction of the Income-tax Officers to whom their cases were transferred, they were certainly not entitled to invoke the jurisdiction of this court under Article 32. It is well-settled that such conduct of the petitioners would disentitle them to any relief at the hands of this court.

31. In view of the aforesaid discussion, we hold that Shri K.K. Uppal had the jurisdiction to make assessment, in spite of the fact, that no order had been passed by any authority to transfer those proceedings to him. There was no lack of inherent jurisdiction in him and his orders cannot be said to be void. At the most, it was irregular assumption of jurisdiction by him and in such an eventuality, the orders passed cannot be nullity.

32. For the reasons recorded above, we, in regard to the first question, hold that returns filed in the present case were good returns in the eye of law and could furnish a basis for proceedings under Section 11(2) of the Punjab General Sales Tax Act, 1948. The answer to this question, therefore, is in favour of the department and against the assessee. In regard to the second question, we are of the opinion that the question of issuance of notice under Sub-section (5) of Section 11 of the Act did not arise as the assessment had not been made under that Sub-section. The answer to this question as well has to be against the assessee and in favour of the department. The third question is also decided in favour of the department and we hold that the order of the Assessing Authority was within its jurisdiction and legally sustainable. In the result, the answer of this question is also against the assessee and in favour of the department. In the peculiar circumstances of the case, the parties are left to bear their own costs.