M/s. Bilal Hussain & Co., Chennai v. The State of Tamilnadu
Case at a glance
Outcome
Dismissed
The writ petition is dismissed as devoid ofmerits
Provisions considered
Key paragraphs
- Para 33. The Commercial Tax Officer, Perambur II Assessment Circle, Chennai 11. RespondentsWrit petition under Article 226 of the Constitution of Indiafor issuance of writ of certiorarified mandamus to call for therecords of the third respondent in R.C. No.1678/92/A3 dated29.09.1997 and quash the proceedings and direct…
- Para 55. In addition to that, the Division Bench while disposing ofthe P.S. Apparels case has given a categorical direction both tothe assessing officer and to the assessee as stated supra. Indisputably, the petitioner has not availed the statutory remedywithin the statutory period of limitation and…
Judgment
IN THE HIGH COURT OF JUDICATURE AT MADRASDated : 10.09.2009Coram :THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIANWrit Petition No.1219 of 1998M/s. Bilal Hussain & Co.,Chennai 12Petitionerv.
The State of Tamilnadu, representedby its Secretary to Government, Commercial Taxes and ReligiousEndowments Department, Fort St. George, Chenna 9.
The Special Commissioner and Commissioner of CommercialTaxes, Chepauk, Chennai 5.
The Commercial Tax Officer, Perambur II Assessment Circle, Chennai 11. RespondentsWrit petition under Article 226 of the Constitution of Indiafor issuance of writ of certiorarified mandamus to call for therecords of the third respondent in R.C. No.1678/92/A3 dated29.09.1997 and quash the proceedings and direct the respondents toenforce the judgment of the Supreme Court in 102 STC 106 only witheffect from 01.05.1996, in the light of the law laid down by the Madras High Court in Writ Appeal No.826 of 1988 dated 16.08.1989and also on the basis of the procedure adopted by the Revenue inrespect of earlier cases. For Petitioner: Mr.Chandran KaruppiahFor respondents: Mr.Tholhappian, Government AdvocateORDERThe petitioner seeks to quash the recovery notice issued bythe third respondent dated 28.08.1996 and further direct therespondents to give effect to the judgment of the Supreme Court inthe case of Vikas Sales Corporation v.
Commissioner of CommercialTaxes, (1996) 102 STC 106 with effect from 01.05.1996. 2. The petitioner is a manufacturer and exporter of leatherand an assessee on the file of the third respondent. Thepetitioner's assessment for the assessment years 1989-90 to 1994-95were finalised by the third respondent resulting in the balance of https://hcservices.ecourts.gov.in/hcservices/ arrears of Rs.70,40,425/- due from it. Out of the above saidarrears, the petitioner paid a sum of Rs.1,22,663/- towards taxinvolved of sales of other goods purchased from unregistereddealers and also sales of assets. The balance arrears amounting toRs.69,17,861/- represented the premium received on the sale of REPlicence as the petitioner failed to pay the arrears. The thirdrespondent issued recovery notice, which is challenged in this writpetition. 3. It could be seen from the records that the arrears accruedon account of separate assessment/revision of assessment passed bythe third respondent for each assessment year from 1989-90 to 1994-95.
The said assessment or revision of assessment has not beenchallenged. However, on issuance of notice of recovery of arrears, this writ petition is filed on the ground that the issue oftaxability of the transfer value of REP licence under the TamilNadu General Sales Tax Act, has been settled by the Supreme Courtin Vikas Sales Corporation v. Commissioner of Commercial Taxes,(1996) 102 STC 106. So, that would be effective from 01.05.1996only. A Division Bench of this Court in P.S. Apparels v. DCTO, 94STC 139, upheld the levy of tax on premium received on the sale ofREP licence. It is pertinent to note that the petitioner was aparty to the said judgment as a petitioner in W.P. No.7436 of 1992.In that judgment, the Division Bench has held that the respectiveassessing authority shall be at liberty to proceed further inmaking assessment where the proceedings have not been finalised andwhere the assessment has already been completed, the assessee couldavail all statutory remedies before the appellate or revisionalauthorities by counting the statutory period of limitation ascommencing from the date of the judgment, i.e., 04.04.1994.
Thepetitioner did not pursue such statutory remedies, but has filedthe present writ petition. Yet another factor to be noted is thatthe petitioner approached Government of Tamil Nadu to permit it topay the arrears in 12 monthly instalments and obtained an order tothat effect in G.O. (D) No.507 CT Department dated 11.12.1997, butfailed to pay even a single instalment. In the above said factualcircumstances, the petitioner filed the writ petition against therecovery notice contending that the taxability of the value of thetransfer of exim scrips should be considered on and from the dateon which the Supreme Court confirmed the order of P.S. Apparels'scase in Vikas Sales Corporation v. Commissioner of CommercialTaxes, (1996) 102 STC 106.
The crux of the contention in this case is that only on andfrom the date on which the judgment was rendered by the SupremeCourt in Vikas Sales Corporation v. Commissioner of CommercialTaxes, (1996) 102 STC 106 levy can be made. The judgment of the Supreme Court is a retrospective judgment. I am not able to concurwith the contention of the appellant as it is well settled that thedecision of the Supreme Court being declaration of the true andcorrect position of law became applicable to all the transactionsand proceedings which have not become final and concluded. Therendering of a judgment by the Supreme Court is not the same asenactment of a statute. A decision of the Supreme Court does not https://hcservices.ecourts.gov.in/hcservices/ make the law, but merely explains and puts in proper perspectivethe true position and effect of the law. The true position of lawso declared exists from the very date of making the law and notfrom the date of declaration by the Supreme Court. When alegislature enacts a statute, it creates rights and obligations andtherefore its operation can be prospective or retrospectivedepending upon the provisions of the statute. But when the Supreme Court gives a decision declaring the law, it does notcreate rights and obligations, but merely identifies and declaresthe pre-existing rights or obligations and declares true or correctposition of law. Thus, it is the cardinal principle ofconstruction for every statute is presumed to be prospective unlessit is expressly or by necessary implication made retrospective inoperation and every decision of the Supreme Court declaring the lawas retrospective unless it is expressly by necessary implicationrestricted to prospective operation. (vide Constitution BenchJudgment of the Supreme Court in the case of Sourabh Chaudri v.Union of India, 2004 (5) SCC 618.
Operative part
In addition to that, the Division Bench while disposing ofthe P.S. Apparels case has given a categorical direction both tothe assessing officer and to the assessee as stated supra. Indisputably, the petitioner has not availed the statutory remedywithin the statutory period of limitation and has thus allowed theassessment to become final. In the said circumstances, the writpetition fails. The writ petition is dismissed as devoid ofmerits. No costs. Sd/-Asst. Registrar//true copy//Sub Asst. RegistrarmfTo1. The Secretary to Government, State of Tamilnadu Commercial Taxes and ReligiousEndowments Department, Fort St. George, Chenna 9.2. The Special Commissioner and Commissioner of CommercialTaxes, Chepauk, Chennai 5.3. The Commercial Tax Officer, Perambur II Assessment Circle, Chennai 11.1 cc to Spl. Government Pleader,(T) Sr.No.46001W.P. No.1219 of 1998BS {CO}TP/18.12.2009.
Questions this judgment answers
What did the Court decide in this case?
The Court recorded the following disposition: The writ petition is dismissed as devoid ofmerits
Which statutory provisions did this judgment involve?
Constitution of India — art. 226; TamilNadu General Sales Tax Act.
Which court decided this case, and when?
Madras High Court, on 10 Sep 2009. The bench was K RAVIRAJA PANDIANWRIT.
Precedent status how later indexed judgments have treated this case
No known negative treatment found in the Courts & Cases corpus.
This is a result about the indexed corpus, not a finding that the judgment remains good law. Coverage may be incomplete.