1966 (10) TMI 140 - HC - VAT and Sales Tax

Sales Tax Authorities cannot impose strict form requirements on authorizations. Court-fee stamp of Rs. 2 required. Costs granted.

LM Mahurkar and Another Versus Sales Tax Officer, Circle II, Nagpur and Others

LM Mahurkar and Another Versus Sales Tax Officer, Circle II, Nagpur and Others - [1967] 20 STC 199 (Bom) Issues Involved:1. Legality of requiring authorisation in the prescribed form (Form 43-A) for sales tax practitioners and advocates.2. Requirement of a general stamp of Rs. 3.30 on the authorisation under the Bombay Stamp Act versus a court-fee stamp of Rs. 2 under the Bombay Court-fees Act.Issue-wise Detailed Analysis:1. Legality of Requiring Authorisation in Prescribed Form:The primary issue was whether the Sales Tax Authorities could insist on authorisation being in the prescribed Form 43-A, and whether this form must include all conditions and terms as stipulated by the authorities. Section 71 of the Bombay Sales Tax Act, 1959, and Rules 66 and 66-A were examined. Section 71 allows representation before the Sales Tax Authority by various persons, including legal practitioners and sales tax practitioners, provided they are authorised in the prescribed form.The court noted that the form's validity was questioned, particularly whether it must include all terms for the engagement between the assessee and the representative. It was held that the form could not restrict the contractual terms between the assessee and the representative. The authorisation to 'attend' must include the right to appear and plead but not necessarily to act unless explicitly stated. This interpretation was supported by analogous provisions in the Income-tax Act and relevant case law.2. Requirement of General Stamp of Rs. 3.30 versus Court-fee Stamp of Rs. 2:The second issue was whether the authorisation should bear a non-judicial stamp of Rs. 3.30 as per the Bombay Stamp Act or a court-fee stamp of Rs. 2 under the Bombay Court-fees Act. The court examined the definitions and provisions of both Acts. It was established that the authorisation is a power-of-attorney within the meaning of both Acts. However, the court held that the proper fee is the court-fee of Rs. 2 as prescribed under item 12 of Schedule II of the Bombay Court-fees Act. This conclusion was based on the nature of the Sales Tax Authorities as executive officers rather than courts, as supported by relevant case law, including decisions from the Supreme Court.Conclusion:The court allowed the petitions, holding that:1. The Sales Tax Authorities cannot insist on the authorisation containing all terms in the prescribed form if the engagement terms differ.2. The authorisation should bear a court-fee stamp of Rs. 2, not a general stamp of Rs. 3.30.The petitioners were entitled to costs against the respondents.