TaxTMI 
TaxTMI 
1996 (6) TMI 311
X X X X Extracts X X X X
X X X X Extracts X X X X
....gineers India Limited, invited tenders for the supply of terminal automation system for Jaipur, Jodhpur and Sidhpur (Gujarat) and also for their installation, commissioning, field acceptance and other services. Petitioner's tenders were accepted, being the lowest. Necessary orders were given. In pursuance thereof, some goods were sent by the petitioner through M/s. Sant Motors in a truck on October 20, 1994. The truck was checked by the Assistant Commercial Taxes Officer, Flying Squad, Jaipur, on alleged suspicion of evasion of tax. The goods were seized and notice under section 22-A(7) was issued. Reply was filed, denying evasion of tax. Not satisfied with the reply, penalty of Rs. 20,03,465 was imposed under section 22-A(7) of the RST Act, 1954. Appeal was filed against the said order imposing penalty and it was dismissed. The second appeal is pending before the Tax Board, Ajmer. At the instance of the said Assistant Commercial Taxes Officer, proceedings were initiated against the petitioner for its registration under the Act, registration was ordered by the Commercial Taxes Officer, Circle A, Jaipur vide order dated April 29, 1995. Against this order also, appeal has been pre....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rity. The principal contacting office of the petitioner in Rajasthan was and is C/o Shri J.N. Sharma, advocate, M.I. Road, Jaipur which falls within the territorial jurisdiction of Commercial Taxes Officer, Circle B, Jaipur and again this area falls under the Commercial Taxes Officer, Works Contract and Leasing Tax, Circle II, Jaipur. Thus the Commercial Taxes Officer, Works Contract and Leasing Tax, Circle II, Jaipur is having the jurisdiction of the petitioner. Application (annexure 12) for rectification under section 37 of the RST Act has also been moved. Application moved under section 38 of the Act has been dismissed on February 16, 1996, vide order annexure 13. 3.. In reply, it is admitted by the Commercial Taxes Officer, Works Contract and Leasing Tax, Circle I, Jaipur (respondent) that the petitioner is a non-resident dealer, assessment order (annexure 6) was passed ex parte, notice (annexure 5) was served upon the petitioner for October 30, 1995, penalty to the tune of Rs. 20,03,465, was imposed, appeal was filed before the Deputy Commissioner (Appeals) II, Jaipur, and it was dismissed on March 22, 1996. Remaining averments made in the application have been denied. It h....
X X X X Extracts X X X X
X X X X Extracts X X X X
....22 and 23 of the notification dated July 19, 1995 (annexure 4) issued under rule 4, Rajasthan Sales Tax Rules, 1995, the Commercial Taxes Officer, Circle B and Commercial Taxes Officer, Circle C, Jaipur, have jurisdiction in respect of the areas of M.I. Road, Jaipur and Sanganer, Jaipur, respectively. Rule 3(4), Rajasthan Sales Tax Rules, 1995 runs as under: "(4) In case of a non-resident dealer, the officer empowered under subsection (2) of section 21 of the Act shall be his assessing authority." Section 21(2) of the Act runs as under: "(2) In the case of a non-resident dealer, the Assistant Commissioner or the Commercial Taxes Officer, as the case may be, having territorial jurisdiction over the place of business in the State of such non-resident dealer, shall be the authority competent to grant registration and such authority, either on the application of such non-resident dealer or otherwise, shall grant him a certificate of registration from such date and with such terms and conditions, as may be specified therein." According to item No. 72 of the said notification (annexure 4), Commercial Taxes Officer, Works Contract and Leasing Tax, Circle II, Jaipur has ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r Singh, advocate deposing the above fact is also enclosed herewith. It is settled proposition of law that because of the mistake/ lapses, if any, on the part of the advocate, the dealer would not suffer and as the dealer was not intimated about the fixation of the case on November 24, 1995 under the above bona fide belief, therefore, this is a fit case for reopening the said ex parte best judgment assessment order under section 38 of the Rajasthan Sales Tax Act." 9.. Paras Nos. 2, 3 and 4 of the affidavit of Shri Bhanwar Singh, advocate, run as under: "2. That on October 30, 1995, I had appeared before the Commercial Taxes Officer, Works Contract and Leasing Tax, Circle I, Jaipur in the case of my above clients and had then moved an adjournment application requesting for adjournment on the ground that as Shri J.N. Sharma, advocate, was only conversant with the legalities of the case of the referred concern/firm and as Shri J.N. Sharma, advocate, had undergone a by-pass surgery and he was unable to appear on the ground and accordingly the case was adjourned for November 24, 1995. 3.. That Shri J.N. Sharma, advocate, was confined to bed and under medical advice he was unabl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....made in the application moved on February 14, 1996 and affidavits of Shri Bhanwar Singh, advocate and Shri S. Gopalakrishnan. Under these facts and circumstances, the affidavits of Shri Bhanwar Singh, advocate and Shri S. Gopalakrishnan have to be believed. 13.. It has been observed in Dinabandhu Sahu v. Jadumoni Mangaraj AIR 1954 SC 411, that the words "sufficient cause" should receive liberal construction so as to advance substantial justice. In Ramjidas v. Mohan Singh 1978 All. Rent Case 496 (1) (SC), it has been observed that court's discretion should be exercised in favour of hearing and not to shut out hearing. It has been observed in Rafiq v. Munshilal AIR 1981 SC 1400, that it is not proper that the innocent litigant, after doing everything in his power to effectively participate in his proceedings by entrusting his case to the advocate, should not be made to suffer for the inaction, deliberate omission or misdemeanour of his counsel. 14.. In view of the aforesaid facts, circumstances and authorities observations, we find sufficient and reasonable cause for the non-appearance of the petitioner itself on November 24, 1995, before the respondent. It is difficult for us ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Acting upon the purchase orders the petitioner-company started carting away the necessary material to the sites where the work was to be completed. The truck which was carrying the material to the site at Goner near Jaipur was checked on October 20, 1994 by the Assistant Commercial Taxes Officer, Flying Squad, Headquarters, Jaipur (in short, "the ACTO") who on alleged suspicion of evasion of tax seized it together with the goods therein and issued a notice to the petitionercompany under section 22-A(7) of the Rajasthan Sales Tax Act, 1954 (hereinafter referred to as "the old RST Act"). This notice was duly replied to on behalf of the petitioner-company. The petitioner-company took up the position that since it was not the owner of the goods seized the question of any evasion of tax under the old RST Act did not arise. The ACTO did not accept the explanation of the petitioner-company and proceeded to impose a penalty of Rs. 20,03,465 under section 22-A(7) of the old RST Act. It took it up in appeal before the Deputy Commissioner (Appeals) II, Commercial Taxes, Jaipur, who vide his order of March 22, 1995, dismissed it. Aggrieved by this order of the first appellate authority it file....
X X X X Extracts X X X X
X X X X Extracts X X X X
....al with it. 21.. The respondent on October 10, 1995, issued a notice to the petitionercompany for assessment under section 10(1)(b) and section 11B of the old RST Act. He called upon the petitioner-company to produce its books of account and other documents before him on October 30, 1995. Since its advocate, Shri J.N. Sharma, had undergone a by-pass surgery on October 27, 1995, his junior Shri Bhanwar Singh, advocate, appeared before the respondent and requested adjournment which was granted and the hearing adjourned to November 24, 1995. Since Shri J.N. Sharma was confined to bed Shri Bhanwar Singh, advocate, appeared before the respondent and moved an application requesting adjournment. Since Shri Bhanwar Singh was under the bona fide impression that for the reason of Shri Sharma's illness adjournment would be granted, he did not take the trouble to inform the petitioner-company in Madras about its obligation to produce its books of account and other documents before the respondent. Since no information was given to the petitioner-company the books of account and other documents could not be brought by it to Jaipur for production before the respondent. On November 24, 1995, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tiate proceedings against it under sections 11, 11A, 11B and 11(4) of the old RST Act and sections 52, 53 and 58 of the RST Act. It has been prayed that the ex parte assessment order dated November 24, 1995, order for rejection of the application under section 38 of the RST Act dated February 16, 1996 and the notice of demand dated February 26, 1996 as also the letter dated January 8, 1996 which the respondent addressed to M/s. Indian Oil Corporation Limited calling upon the latter not to make payment to the petitioner-company be quashed. It has further been prayed that the case be transferred to the concerned Commercial Taxes Officer. 23.. In the counter filed on behalf of the respondent the allegations concerning the seizure of the truck together with the goods therein, registration of the petitioner-company, levy of tax together with the interest thereon and several bouts of litigative battle before various authorities have not been denied. It has been averred that the respondent has the jurisdiction to deal with the case of the petitioner-company. As regards the ex parte order of assessment it has been averred that nobody on behalf of the petitioner-company appeared before t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rly mentioned in para 8 of the petition that Commercial Taxes Officer, Circle A, Jaipur, was notified by the State Government as the sole assessing authority for all the non-resident dealers. The original notification dated June 4, 1957, was followed by another notification dated October 23, 1967, which in turn has been followed by notification dated July 19, 1995. It is the latest notification dated July 19, 1995, which holds the field and which determines and fixes the circles specifying the jurisdictional areas of the Commercial Taxes Officers of various grades and designations. It is under this notification that the power, authority and jurisdiction of the respondent to deal with the case of the petitionercompany has been taken away and assigned to the Commercial Taxes Officer, Works Contract and Leasing Tax, Circle II, Jaipur. According to the learned counsel for the petitioner-company the reason for the change is that the petitionercompany has been executing its work assigned to it under the contract at Goner which falls within the area of Circle C, Jaipur. The petitioner-company has given the address of its advocate Shri J.N. Sharma at M.I. Road, Jaipur, for the purpose of c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....notifications. The notification dated June 4, 1957, is as hereunder: "APPOINTMENT OF AUTHORITY FOR REGISTRATION APPLICATION Notification No. F. 284(3/1)ST/57/841, Udaipur, June 4, 1957. In exercise of the powers conferred by item No. 3 of the Schedule to the Government of India, Ministry of Finance (the Department of Economic Affairs), Order No. 9(3)P(S.T.)56, dated the 22nd February, 1957, the Sales Tax Officer, Circle A, Jaipur City is hereby appointed as the authority to whom application for registration under section 7 of the Central Sales Tax Act, 1956, shall be made by a dealer having no fixed place of business in the State of Rajasthan. [Pub. in Raj. Gaz., Part IV(C), dated 20-6-1957]" The authority for the issuance of this notification was given vide the notification dated February 22, 1957 which was issued by the Central Government and which is as hereunder: "AUTHORISATION FOR REGISTRATION APPLICATION Notification S.R.O. No. 643, dated February 22, 1957 In exercise of the powers conferred by sub-section (1) of section 7 of the C....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rcise jurisdiction subject to the jurisdiction of Assistant Commissioners/Commercial Taxes Officers, Works Contracts and Leasing Tax as laid down in clause (iii) of para 2: (ii) All the Assistant Commissioners/Commercial Taxes Officers posted in the Works Contract and Leasing Tax Circles, shall have jurisdiction over dealers whose fifty per cent or more of gross turnover in the accounting year 1991-92 or in any year thereafter, relates to the turnover of works contract and/or leasing of goods. S. No. Designation of Assistant Commissioner/Commercial Taxes Officer Name of the circle Area of jurisdiction (1) (2) (3) (4) 71 A.C./C.T.O. Works Contract and Leasing Tax Circle, Jaipur, Zone I. Works Contract and Leasing Tax Circle,Jaipur, Zone I. Area of the Circles A, E, F and G of Jaipur City. 72 A.C./C.T.O. Works Contract and Leasing Tax Circle, Jaipur, Zone II. Works Contract and Leasing Tax Circle, Jaipur, Zone II Area of the Circle C, Jaipur, Area of Circles B and D, Jaipur City and Revnue District Dausa. 28.. In order to grapple with the problem I have to find out as to whether the petitioner-company has any principal place....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny makes it clear in its petition itself that it has its registered office at 147, Karapakkam Village, Madras, in Tamil Nadu. It has its factory at Viralimalai which is also in Tamil Nadu. It is duly registered in the Tamil Nadu General Sales Tax Act, 1959, and the Central Sales Tax Act, 1956, with the Commercial Taxes Officer, Tiruvanmiyur. It does not breathe a word in its petition about its place of business in the State of Rajasthan. What it alleges is that it is engaged in the execution of the works contract assigned to it by M/s. Indian Oil Corporation Ltd., at two separate places-one in Jaipur district and the other in Jodhpur district. The place of its worksite cannot be treated to be its place of business in the light of the definition of the term "place of business" as given in section 2(30). The address given by the petitioner-company for the purpose of carrying on its communication with the outside world is the office of its advocate, Shri J.N. Sharma, at M.I. Road, Jaipur. The office of the advocate cannot be treated to be a place of business of the petitioner-company. Nor does the petitioner-company plead or allege that the office of its advocate, Shri J.N. Sharma is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oncerned exercises jurisdiction. Implicit in it is the conclusion that respondent will continue to exercise jurisdiction with regard to Here italicised. a dealer who has no principal place of business in the State of Rajasthan. I may look at it from another angle also. The petitioner-company is engaged in the execution of its works contract at two separate places in the State of Rajasthan. If the contention of the learned counsel for the petitioner-company is accepted as correct then the petitioner-company shall be required to deal with two separate assessing authorities-one at Jaipur and the other at Jodhpur. It will cause much hardship and inconvenience to the petitioner-company or to any other dealer placed in its position. 32.. I may briefly deal with the contention raised on behalf of the department that if the petitioner-company had any doubt or dispute with regard to the jurisdiction of the respondent to deal with its case it must have brought this matter to the notice of the Commissioner under section 41 of the RST Act. The Commissioner on being satisfied about the genuineness of the matter may order the transfer of the case to a different assessing authority. Such a cou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ned above, even the registration was granted by him. A combined reading of section 21(2) of the RST Act and rule 3(4) of the Rules of 1995 makes it clear that the authority which grants registration certificate shall be the assessing authority. From whatever angle I look at it I find that the respondent had the jurisdiction to deal with the matter. 36.. I hold that the respondent had the power, authority and/or jurisdiction to deal with the matter before him. Point No. 3: 37. The truck together with the goods therein was seized on October 20, 1994. The petitioner-company was registered on April 29, 1995. It was on October 10, 1995, that the respondent issued a notice to the petitioner-company calling upon it to participate in the hearing which was fixed for October 30, 1995. In the meanwhile the learned counsel for the petitioner-company Shri J.N. Sharma fell ill and had to undergo a by-pass surgery on October 27, 1995. Shri Bhanwar Singh, advocate, a junior colleague of Shri J.N. Sharma participated in the proceedings on October 30, 1995, before the respondent. On account of the illness of Shri J.N. Sharma, Bhanwar Singh requested adjournment which was duly gran....