Supreme Court of India
Divisional Forest Officer vs Presiding Officer And Ors. on 5 September, 1997
Equivalent citations: JT1998(9)SC125, (1998)9SCC275, AIRONLINE 1997 SC 554
Bench: M.M. Punchhi, S.P. Kurdukar
ORDER
1. Leave granted. Heard learned counsel.
2. This appeal arises out of an order dated 11-11-1988 passed by the High Court of Punjab and Haryana in Civil Writ Petition No. 5039 of 1988 dismissing the writ petition of the appellant in limine.
3. The appellant herein is the Divisional Forest Officer, Timber Extension Division, Kullu, Himachal Pradesh, in charge of the Sales Depot at Nangal which is within the State of Punjab. The appellant is a registered dealer, as the expression is known to the Punjab General Sales Tax Act, 1948, (hereinafter referred to as "the Act"). During the relevant assessment year, the appellant transacted more than one sale in favour of the respondent Punjab Export Corporation Ltd., Chandigarh, a government corporation. The appellant required of the buyer-Corporation to supply him declarations under Form ST XXII in order to claim statutory deduction. By then winding-up proceedings were on. An official liquidator stood appointed. The official liquidator instead of supplying those forms issued a certificate verifying the sales. But since this did not satisfy the legal requirements, the claim of the appellant for deduction was negatived by the assessing authority. The appeal of the appellant was dismissed by the appellate authority and finally the second appeal was dismissed by the Sales Tax Tribunal which necessitated the appellant to approach the High Court by means of a writ petition which was dismissed in limine. The effort before the High Court as also here is to direct the buyer-Corporation through its liquidator to supply Form ST XXII in order to enable the appellant claim deductions for the sales effected by the appellant as a registered dealer.
4. It is not denied that a deduction is claimable under the provisions of Sub-clause (ii) of Clause (a) of Sub-section (2) of Section 5 of the Act. Rule 26 of the Punjab General Sales Tax Rules, 1949 provides the methodology of obtaining and filling Form ST XXII. Rule 26 is extracted below:
"26. (1) Any dealer, who wishes to deduct from his gross turnover the amount in respect of a sale on the grounds that he is entitled to make such deduction under the provisions of Sub-clause (if) of Clause (a) of Sub-section (2) of Section 5 shall, along with his return in Form ST VIII in respect of such a sale furnish 'C' part of declaration in Form ST XXII duly filled up and signed by purchasing dealer or his agent.
(2) Any dealer registered under the Act shall apply to the appropriate Assessing Authority for the grant of declaration in Form ST XXII stating clearly his reasonable demand for a period of not more than six months disclosing the stock and details of declaration forms already in hand and also the date on which and the number in which he was last issued the declaration forms.
(3) If the Assessing Authority referred to in Sub-rule (2) is satisfied that the requisition of the dealer is genuine and reasonable, he may issue him as many declaration forms as he may deem fit on prior payment of price of such forms to be fixed by the Government from time to time of such sum.
(4) A single declaration in Form ST XXII shall cover one or more than one transaction of sale, provided that in the latter case the total value of sale made to one registered dealer in one return period does not exceed twenty thousand rupees.
(5) The dealer to whom the declaration forms have been issued shall be responsible for their proper custody and use. If a declaration form, whether blank or completed, is lost either from the custody of any dealer or from the purchasing dealer.
(6) On receipt of report referred to in Sub-rule (5) above, the said authority shall call upon the dealer to furnish a reasonable security by way of an indemnity bond in Form ST XXIX in respect of each lost form separately or in respect of all the lost forms collectively to safeguard against the misuse of the same.
(7) If the duly completed and signed declaration form is lost by the purchasing dealer in transit or from the custody of selling dealer, the selling dealer shall obtain a duplicate form from the dealer, to whom he sold the goods. In the absence of such duplicate form he will not be entitled to the deductions.
(8) Where any purchasing dealer issues to the selling dealer a duplicate form referred to in Sub-rule (7), he shall give the following certificate in red ink across the page on all the three parts of the duplicate form. The certificate shall be duly signed by the dealer issuing the duplicate form- 'I hereby certify that this is the duplicate of the declaration Form No. ... signed on ... and issued to ... who is registered dealer holding Registration No....' (9) If the dealer closes down his business or his registration certificate is cancelled for any other reason, he shall forthwith surrender all the declaration forms lying unused with him to the officer from whom he obtained them.
(10) The dealer referred to in Sub-rule (3) shall maintain a register containing account of the declaration forms in the following form:
Date on which the declaration forms were received. ... Number of declaration forms received....
Total No. of Serial No. of No. of forms Balance of forms used first and last used stock in hand form of every on the date of book issued fresh application (11) The dealer shall produce the register prescribed in Sub-rule (10) on demand by an Assessing Authority or any other officer subordinate to him and duly authorised by him writing for inspection.
(12) The State Government may, by notification in the Official Gazette, declare certain series, designs or colour of declaration forms as obsolete and invalid. All the dealers shall, on or before the date from which the declaration forms are declared obsolete, surrender to the appropriate Assessing Authority, all such forms which may be in their possession and obtain in exchange such new forms as may be substituted for the forms declared obsolete and invalid: Provided that new forms shall not be issued to a dealer until he has rendered account of the old forms issued to him and actually returned the balance in hand, if any, to the appropriate Assessing Authority."
5. Rule 27-A is relevant, which provides as follows: "27-A. A dealer who wishes to make deductions from his gross turnover the amount in respect of a purchase on the ground that he is entitled to make such deductions under Sub-clause (vi) of Clause (a) Sub-section (2) of Section 5 of the Act shall, along with his return in Form ST VIII furnish 'C' part of the declaration in Form ST XXII duly filled up and signed by the purchasing dealer or by his agent and also append to his return a list in Form ST XXVII-B, or Form ST XXVII-C, as the case may be."
6. There is no doubt that it is the dealer who wishes to deduct from his gross turnover the amount in respect of a sale exemptible under sub-clause (II) of clause (a) of sub-section (2) of Section 5 can approach the assessing authority for being granted the said form or forms in order to avail of the benefit of Rule 26. It is equally not denied that the appellant and the Corporation is such person. In the first place, it was for the appellant to apply for the grant of those forms to the assessing authority, then to have them duly filled and the counterfoils put to use as part of his return. It seems that the forms were neither solicited by the appellant nor by the Corporation in order to shift the liability of payment of sales tax to the purchaser who could, in the event of sale on his behalf pass on the liability onwards to the last sale.
7. Mr R.S. Sodhi, learned counsel appearing for the State of Punjab, is candid enough to state that should the appellant now apply to the assessing authority for the grant of the requisite form/forms, there is no doubt that such form or forms will be provided to the appellant for putting them to use for the sales involved since the authenticity of the sales cannot be disputed, it being government to government (government-owned corporation) sale. The question is only of shifting the responsibility. Once that is accomplished the forms duly filled have to be signed by the Corporation, at present under liquidation. It is the liquidator who is enjoined under the law to perform his part in making the form or forms vibrant and use worthy. We are thus of the view that the State of Punjab and the assessing authority on one part and the buyer-Corporation and its liquidator on the other are under the legal responsibility of facilitating the appellant transfer his liability towards payment of sales tax for the sales involved in the relevant assessment year. To facilitate the appellant to do the same, we issue directions to the respondents concerned to perform their duties as enjoined under the Act and once that is done, it would be open to the appellant to move the sales tax authorities for a suitable review so as to undo the orders already passed by them on the basis that the requisite Form ST XXII has not been produced.
This relief to the appellant should suffice. Let the exercise commence within six weeks from today and be finalised as quickly as possible.
8. As a result this appeal is allowed, the judgment and order of the High Court is set aside and the matter is streamlined to be adjusted in the manner above-stated. No costs.