Allahabad High Court
Commissioner, Sales Tax vs Bhagwan Das Hari Das on 11 March, 1987
Equivalent citations: [1988]69STC246(ALL)
JUDGMENT R.R. Misra, J.
1. This revision has been filed by the Commissioner . of Sales Tax, against the order dated 4th June, 1986 passed by the Sales Tax Tribunal, Varanasi, relating to the assessment year 1975-76. During the said year, the assessee carried on the business in jute goods, newar, etc. The goods dealt with by the assessee were purchased both within Uttar Pradesh and outside Uttar Pradesh. Originally, vide assessment order dated 16th August, 1979, the assessment was framed for the above assessment year by the Sales Tax Officer under Rule 41(7) of the U. P. Sales Tax Rules, hereinafter referred to as the Rules. Subsequently, proceedings under Section 21 of the U. P. Sales Tax Act, hereinafter referred to as the Act, were initiated against the assessee for the above assessment year on the ground that tax on coir matting has been assessed at a lower rate and proper tax payable on the same was as unclassified item. The assessee disputed both the initiation of the aforesaid proceedings under Section 21 of the said Act as well as the question that the said goods are liable to be taxed as unclassified item. The Sales Tax Officer, however, completed the assessment under Section 21 of the said Act vide his order dated 30th March, 1982, and appeal against the same filed by the assessee was also dismissed by the Assistant Commissioner (Judicial) vide order dated 26th November, 1982. The assessee took the matter further in appeal before the Sales Tax Tribunal. After hearing counsel for the parties the Tribunal has allowed the appeal of the assessee under the impugned order on two counts. Firstly, that the goods in question are made of jute, and therefore, fell within the classification of jute and cannot be termed and taxed as unclassified item. Secondly, after reviewing the facts of the case, the Tribunal came to the conclusion that this was a case of change of opinion. The Tribunal was of the view that the appeal had to be allowed and it allowed the same accordingly. The Commissioner of Sales Tax has now filed the present revision against the aforesaid order of the Tribunal in this Court.
2. I have heard the learned Standing Counsel. Two submissions have been made by the learned counsel appearing for the Commissioner of Sales Tax. The first is that coir goods are not jute goods and the second is that it is not a case of change of opinion. The Tribunal has under the impugned order recorded the following finding :
...It has not been disputed that the mat, coir mat and the matting taken to be unclassified by the assessing authority are made of jute. Naturally, had the legislature intended to take these goods out of the purview of the jute goods, it would have concluded them by making a specific provision and would not have treated the jute goods of all types as classified item. In ordinary parlance also jute goods implies and means all goods made of jute. I am afraid that in absence of any specified provision, mat, coir mat and foot mats made of jute could have been taken out of jute goods and held exigible to tax as unclassified items.
3. The learned Standing Counsel sought to dispute the aforesaid findings of fact recorded by the Tribunal by relying upon the dictionary meaning of the word "coir" as well as the definition of the word "jute" as stated under Section 4 of the Central Sales Tax Act.
4. In Webster's III International Dictionary the word "coir" has been stated as under :
'Coir' is a stiff coarse fibre obtained from the outer husks of the coconut.
5. Section 14, Sub-clause (v), of the Central Sales Tax Act defines the word "jute" as under :
'Jute', that is to say, the fibre extracted from plants belonging to the species corchorus capsularis and corchorus olitorious and the fibre known as mesta or bimli extracted from plants of the species Hibiscus cannabinus and hibiscus sabdariffa-Var-altissima and the fibre known as sunn or sunn-hemp extracted from plants of the species crotalaria juncea whether baled or otherwise.
6. This definition under the Central Sales Tax Act implies investigation of facts, as to whether a particular fibre is extracted from particular plants. A perusal of the orders passed by the authorities below shows that nowhere this question was either raised nor an investigation into these facts was arrived at by the authorities concerned, including the Tribunal. To my mind the same cannot be now allowed to be raised for the first time in revision in this Court. On the other hand I find from the quotation stated above that the Tribunal has recorded a finding of fact that the goods in dispute are made of jute. This finding of fact has not been specifically challenged by raising any question of law that as to whether there was a material for the said finding or whether the said finding was perverse. In this view of the matter I am of the opinion that the first submission made by the Standing Counsel fails.
7. As regards the second submission, it may be stated that since a copy of the assessment order passed under Rule 41(7) of the U. P. Sales Tax Rules was not filed on behalf of the Commissioner of Sales Tax, I had called for the original assessment files for the assessment years 1975-76 and 1976-77 and they were produced before me at the time of hearing. A perusal of the said original assessment order dated 16th August, 1979 discloses that details of form No. 31 were filed before the Sales Tax Officer and the same were examined by him. The original records produced before me also contained counterfoils of the aforesaid original form No. 31. In form No. 31, there is a specific column which mentions description of goods and the quantity thereof along with other details. A persual of the aforesaid originals of form No. 31 by me establishes, that in various forms, the disputed commodity was specifically mentioned as nariyal, paukosh, brush, nariyal tat, coir matting, jute, etc. It appears that after examinations of these originals of form No. 31, the Sales Tax Officer was also of the opinion that the aforesaid coir matting, etc., formed part of jute goods. This was also not disputed before the Sales Tax Tribunal. This view of mine is further strengthened by the explanation furnished by the assessee before the Sales Tax Officer. A perusal of the same discloses that it is the auditor who had raised an objection regarding classification of the goods in question, and reply of the dealer was that the disputed goods are included in the term jute goods and are used as such. The assessee had disputed the report of the auditor and has reaffirmed that coir matting was jute goods. Therefore, in my opinion, the case in the original proceedings had proceeded on the basis that the,goods in dispute formed part of the jute goods. Thus from the above facts in my opinion, there is no infirmity in the finding of facts recorded by the Tribunal that on the facts and circumstances of the case, this .was a case of change of opinion by the Sales Tax Officer. In the sole question of law raised in this Court, the said finding of fact has also not been challenged. Thus one has to proceed by accepting the aforesaid finding of fact recorded by the Tribunal, that the present was a case of change of opinion. The learned Standing Counsel, appearing on behalf of the Commissioner of Sales Tax, has not disputed the legal position, that in case it is a case of change of opinion, no action under Section 21 of the Act was maintainable.
8. Let me now take stock of the authorities cited at the Bar. The learned Standing Counsel relied upon the case of Commissioner, Sales Tax v. Steel Engineering Corporation 1981 UPTC 70. In that case there was nothing on record to show that the Sales Tax Officer, while examining the original assessment, had examined the claim of the assessee, that the disputed items were declared goods with reference to the relevant provisions of law. As the said judgment itself states that in that case there was non-application of mind by the Sales Tax Officer. In the present case before me there is application of mind by the Sales Tax Officer and thereafter the claim of the assessee was accepted by the Sales Tax Officer concerned. In paragraph 8 in the case of Steel Engineering Corporation [1981] 48 STC 432 (All.); 1981 UPTC 70 the court has specifically mentioned that in case of change of opinion, proceedings under Section 21 of the Act cannot be taken. Sri R. G. Padia, learned counsel appearing on behalf of the dealer, has heavily relied upon the case of Commissioner of Sales Tax v. Jagdish Prasad Satish Prasad 1979 UPTC 820. In that case, in proceedings under Rule 41(5) of the Rules, the Sales Tax Officer had considered the sale of foodgrains made by the assessee on behalf of the ex-U. P. principals, and had held them to be non-taxable. Subsequently, taking the view that they were taxable, a notice under Section 21 was issued on his own subjective view. After taking into consideration a large number of decisions of this Court as well as of the Supreme Court, the learned Judge, who decided that case, was of the opinion that the reassessment proceedings under Section 21 of the Act cannot be initiated on a mere change of opinion.
9. In a recent judgment in the case of Commissioner, Sales Tax v. Pradeshik Co-operative Federation Ltd. 1987 UPTC 127, I have also taken a view that the finding recorded by the Tribunal, that the proceedings under Section 21 were taken as a result of change of opinion, is a finding of fact. In this view of the matter also and having regard to the aforesaid findings of fact recorded by the Tribunal, in my opinion, on the facts and circumstances of this case, the proceedings for reassessment taken by the Sales Tax Officer were invalid. I, therefore, find no infirmity in the impugned order passed by the Sales Tax Tribunal. Thus all the submissions made by the Standing Counsel lack substance and are hereby rejected.
10. In the result, the revision fails and is dismissed with costs.