Appeal No 1283 of 1967
Appeal by special leave from the Order dated April 23 1967 of the Court of Assistant Commissioner Judicial 1 Sales Tax Kanpur Range Kanpur in Appeal No DF78 of 1966
J P Goyal and Sobhag Mal Jain for the appellant
O P Rana for the respondents
The Judgment of the Court was delivered by Hidayatullah J
This is an appeal by special leave against an order 23 April 1967 of the Assistant Commissioner Judicial 1 Sales Tax Kanpur Range Kanpur by which the Assistant Commissioner rejected as defective the memorandum of appeal filed by the present appellant against the assessment order passed by the Sales Tax Officer S 1 Kanpur
The defect according to the Assistant Commissioner was that the memorandum of appeal which had been filed well within time was not accompanied by the challan showing the deposit of admitted tax under section 9 of the Uttar Pradesh Sales Tax Act 1948
The appellant did not file an application for revision and did not also invite a reference to the High Court of Allahabad but came direct to this Court by special leave which was granted by us on August 23 1967
At the first hearing of the petition the State of Uttar Pradesh represented by Mr OP Rana objected to the grant of special leave inasmuch as the other provisions under which remedy could be obtained under the Sales tax Act had been bypassed
At that time we overruled the objection and in the course of this judgment we shall briefly indicate the reasons which had then prevailed with us
The facts of the case are as follows The appellant had declared his turnover for the year 1964 65 at Rs 3709417 P on which the admitted tax under the Act came to Rs 1113558p
The Sales tax authorities however assessed his turnover at Rs 30 lakhs on which tax was calculated at Rs 90000
The appellant appealed to the Assistant Commissioner Judicial 1 Sales tax Kanpur Range Kanpur
His appeal was filed on May 16 1966 the order of assessment and the demand notice having been served on him on April 16 1966
The appeal was therefore filed within time
Section 9 of the Act provides that no appeal against an assessment shall be entertained unless it is accompanied by satisfactory proof of the payment of the amount of tax admitted by the appellant to be due or of such instalments thereof as may have become payable
As is stated earlier the admitted tax came to 507 Rs 1113558 P
The appellant was required under this provisions of law to give satisfactory proof at the time of the entertainment of the appeal that this tax was duly paid
It appears that the appellant had paid a greater portion of the tax even before the assessment order had been made and a balance of Rs 9999 P was due from him from the amount of admitted tax
This amount was deposited on April 26 1966 before the appeal was filed by him
He did not however present any proof of such deposit because there is a dispute in the case whether the assessee bad shown proof of it to the mumarim or not
As the finding is that he had not shown it we shall proceed on the assumption that the assessee had not furnished proof at the time of the filing of the appeal that the balance of tax had been paid It is on this premise that the present appeal has proceeded before us
On August 16 1966 the assessee addressed a letter to the Sales tax Officer and asked for a certificate of payment of tax and this certificate having been furnished he filed it on January 24 1967 before the Assistant Commissioner
He also as a matter of abundant caution filed an application for condonation of delay under section 96 of the Act read with section 5 of the Indian Limitation Act
The order against which the present appeal has been brought before us was made on 23 April 1967 and the appeal of the assessee was rejected
because in the opinion of the Assistant Commissioner section 9 of the Act read with r 662 had not been complied with since no proof had been given along with the memorandum of appeal that the tax had been paid
Simultaneously the application for condonation of delay was also dismissed
Against this order the assessee has filed the present appeal
The short question in this case is whether having made the deposit even before the appeal was filed and well within the period of limitation the assessee could be deprived of his right of appeal under section 9 of the Act
Alternatively it is to be considered whether the proof of the payment of the admitted tax had to accompany the memorandum of appeal as required by r 662 and on failure to furnish such proof the appeal itself became incompetent
In support of his order the Assistant Commissioner relied on a decision of the Allahabad High Court reported in Swastika Tannery of Jaimau vs Commissioner of Sales tax UP Lucknow1 in which the learned Chief Justice of that Court and another learned Judge have laid down that the proof of payment must be as required by the rules and therefore
the memorandum of appeal ouaht to be accompanied by the Challan showing payment of tax before the appeal can be said to be competent
We shall refer to that ruling presently
in this appeal learned counsel for the assessee has relied upon a number of authorities in which the interpretation runs 1 1963 14 STC 518
508 counter to the decision of the learned Chief Justice just adverted to and had contended that section 9 of the Act does not create the bar which the ruling and the Assistant Commissioner s reliance on that ruling has created in the way of the appeal
His contention is that if satisfactory proof is given before the appeal is heard or at any rate before it is admitted the requirement of law under section 9 is satisfied and that it is not always incumbent to produce a challan with the memorandum of appeal r 662 notwithstanding
It is this point which has given rise to the great controversy before us and the matter was argued at great length both at the time of grant of special leave and today
To consider the matter we may begin by quoting section 9 of the Act
Section 9 which gives the power of appeal provides as follows 1 Any dealer objecting to an order allowing or refusing an application for exemption certificate under cl
b of sub section 1 of section 4 or to an order refusing an application under section 30 or to an order imposing a penalty under section 15 A or to an assessment made under section 7 7 A 7 B 18 or 21 may within 30 days from the date of service of the copy of the order or notice of assessment as the case may be appeal to such authority as may be prescribed Provided that no appeal against an assessment shall be entertained unless it is accompanied by satisfactory proof of the payment of the amount of tax admitted by the appellant to be due or of such instalments thereof as may have become payable Under section 24 of the Act power has been conferred upon the State Government to make rules to carry out the purposes of the Act and in particular to provide for all matters expressly required or allowed by this Act to be prescribed
Under sub section
4 of that section it is provided that all rules made under the section shall be published in the Gazette and upon such publication shall have effect immediately as if enacted in the Act and under the 5th sub section it is further provided that all rules made under the Act shall be laid for fourteen days before the Legislature as soon as possible after they are made and shall be subject to such modifications as the Legislature may make during the session in which  they are so laid
In exercise of this power the State Government has framed the UP Sales tax Rules 1948
Rules 66 and 67 of these rules bear among others upon appeals
Sub r 1 of r 66 provides for the content of the appeal by stating what the memorandum of appeal shall specify in relation to the name and address of the appellant etc
We are not concerned with it
Sub r
509 2 then states that the memorandum of appeal shall be accom panied by  a challan showing deposit in the Treasury of the tax admitted by the appellant to be due or of such instalments thereof as might have become payable
 Rule 67 days down how the appeals have to be presented
Sub r 1 provides that the memorandum of appeal shall be presented by the appellant or his lawyer or duly authorised agent to the Assistant Commissioner Judicial or may be sent by registered post addressed to the Assistant CommissionerJudicialSub r 2 provides that if the memorandum of appealis in order
the Assistant Commissioner Judicial shall admitit and on admission
the Reader of the Assistant Commissioner Judicial shall endorse thereon the date of its presentation and shall register it in a book to be known as Register of Appeals
The third sub rule says that if the memorandum of appeal is not in order
it may be rejected or returned after the necessary endorsement on its back about the presentation and return to the applicant for correction and representation within the time to be fixed by the Assistant Commissioner Judicial or be amended then and there
Lastly sub r 4 provides that on admission of an appeal
the Assistant Commissioner Judicial shall fix a date for hearing of the appeal and may send for the record
if necessary
The contention of counsel for the assessee is that he had fully complied with the requirements of section 9 although not strictly as laid down in r 66 which he characterised as directory
The contention on the other side is that the rule lays down the only manner of compliance with the provisions of the Section and in support Counsel for the State refers to the provisions of section 244 and 5 in which it is stated that the rules on being framed become part of the Statute
From this counsel for the State infers that there is no other modeof compliance except the one stated in the rules and as in thiscase that mode of compliance was not followed the appeal is rightly considered to be incompetent and properly rejected
This in main represents the essence of the controversy between the parties
To begin with it must be noticed that the proviso merely requires that the appeal shall not be entertained unless it is accompanied by satisfactory proof of the payment of the amount of tax admitted by the appellant to be due
A question thus arises what is the meaning of the word entertained  in this context Does it mean that no appeal shall be received or filed or does it mean that no appeal shall be admitted or heard and disposed of unless satisfactory proof is available  The dictionary meaning of the word entertain  was brought to our notice by the parties and both sides agreed that it means either to deal with or admit to consideration
We are also of the same opinion
The question therefore is at what stage can the appeal be said to be entertained for the purpose of the appllication of the proviso Is it 510 entertained when it is tiled or is it entertained  when it is admitted and the date is fixed for hearing or is it finally entertained  when it is heard and disposed of Numerous cases exist in the law reports in which the word entertained  or similar cognate expressions have been interpreted by the courts
Some of them from the Allahabad High Court itself have been brought to our notice and we shall deal with them in due course
For the present we must say that if the legislature intended that the word file  or receive  was to be used there was no difficulty in using those words
In some of the statutes which were brought to our notice such expressions have in fact been used
For example
under Order 41
rule I of the Code of Civil Procedure it is stated that a memorandum shall not be filed or presented unless it is accompanied etc
 in section 17 of the Small Causes Courts Act the expression is at the time of presenting the application 
In sec
6 of the Court Fees Act the words are file  or shall be received 
It would appear from this that the legislature was not at a loss for words if it had wanted to express itself in such forceful manner as is now suggested by counsel for the State
It has used the word e entertain  and it must be accepted that it has used it advisedly
This word has come in for examination in some of the cases of the Allahabad High Court and we shall now refer to them
In Kundan Lal vs Jagannath Sharma1 the Court was concerned with Order 21 rule 90 of the Code of Civil Procedure which bad been amended by the High Court by changing the pro visions of the original Code
The changed rule is as follows Provided that no application to set aside the sale shall be entertained a upon any ground which should have been taken by the applicant on or before the date on which the sale proclamation was drawn up b Unless the applicant deposits such amount not exceeding 12 12  of the sum realised by the sale or furnishes such security as the court may in its discretion fix except when for reasons to be recorded it dispenses with the requirements of this clause   The word entertain  is explained by a Divisional Bench of the Allahabad High Court as denoting the point of time at which an application to set aside the sale is heard by the court
The expression entertain  it is stated
does not mean
the same thing as the filing of the application or admission of the application by the court
A similar view was again taken in Dhoom Chand Jain vs Chamanlal Gupta  Anr2 in which the learned Chief 1 AIR 1962 All 547
2 ALR
1962 AU
511 Justice Desai and Mr Justice Dwivedi gave the same meaning to the expression entertain 
It is observed by Dwivedi J that the word entertain  in its application bears the meaning admitting to consideration  and therefore when the court cannot refuse to take an application which is backed by deposit or security it cannot refuse judicially to consider it
In a single bench decision of the same court reported in Bawan Ram  Anr
vs Kunj Beharilal1 one of us Bhargava J bad to consider the same rule
There the deposit had not been made within the period of limitation and the question had arisen whether the court could entertain the application or not
It was decided that the application could not be entertained because proviso b debarred the court from entertaining an objection unless the requirement of depositing the amount or furnishing security was complied with within the time prescribed
In that case the word entertain  is not interpreted but it is held that the Court cannot proceed to consider the application in the absence of deposit made within the time allowed by law
This case turned on the fact that the deposit was made out of time
In yet another case of the Allahabad High Court reported in Haji Rahim Bux  Sons and Ors
vs Firm Samiullah  Sons2 a division bench consisting of Cheif Justice Desai and Mr Justice section D Singh interpreted the words of 0 21 r 90 by saying that the word entertain  meant notreceive  or accept  but proceed to consider on merits  or adjudicate upon 
In our opinion these cases have taken a correct view of the word entertain  which according to dictionary also means admit to consideration 
It would therefore appear that the direction to the court in the proviso to section 9 is that the court shall not proceed to admit to consideration an appeal which is not accompanied by satisfactory proof of the payment of the admitted tax
This will be when the case is taken up by the court for the first time
In the decision on which the Assistant Commissioner relied the learned Chief Justice Desai CJ holds that the words accompanied by  showed that something tangible had to accompany the memorandum of appeal
If the memorandum of appeal had to be accompanied by satisfactory proof it had to be in the shape of something tangible because no intangible thing can accompany a document like the memorandum of appeal
In our opinion making an appeal  the equivalent of the memorandum of appeal is not sound
Even under 0
41 of the Code of Civil Procedure
the expressions appeal and memorandum of appeal are used to denote two distinct things
In Wharton s Law Lexicon the word appeal is defined as the judicial examination of the decisions by a hi her Court of the decision of an inferior court
The appeal is the judicial examination the memorandum of appeal contains the rounds on which the judicial examination is invited
1 AIR 1961 All 42
2 AIR 1963 All
512 For purposes of limitation and for purposes of the rules of the Court it is required that a written memorandum of appeal shall be filed
When the proviso speaks of the entertainment of the appeal it means that the appeal such as was filed will not be admitted to consideration unless there is satisfactory proof available of the making of the deposit of admitted tax
Now the complicating factor is the existence of the rule and here the divergence of submission arises on whether the rules can be regarded as mandatory or merely directory
It is quite obvious that the section as it stands only requires that at the time of the consideration of the appeal There should be satisfactory proof that the admitted tax has been deposited
It only says that no appeal shall be entertained unless accompanied by satisfactory proof of the payment of the tax
This satisfactory proof may take any form in fact in the present case satisfactory proof was tendered in the shape of a certificate from the Sales tax Officer that the admitted tax had been deposited and well within time
Under section 9 and its proviso as they stand it is quite obvious that entertainment  means the point of time when the appeal is being considered
There was thus satisfactory proof in the present case
No doubt proof was not tendered following the method required by the rules but the question is whether the rules can make the section narrower by prescribing a particular mode
The section is general it provides that the court should accept satisfactory proof
The rule requires that the memorandum of appeal shall be accompanied by the challan showing payment of tax
The rule lays down one uncontestable mode of proof which the Court will always accept but it does not exclude the operation of the proviso when equally satisfactory proof is made available to the officer hearing the appeal and it is proved to his satisfaction that the payment of the tax has been duly made and in time
In this sense the rule can be regarded as directory since it lays down one of those modes which will be unquestioned for its validity
The other modes of proof are not necessarily shut out
It is to be remembered that all rules of procedure are intended to advance justice and not to defeat it
Here the right of appeal has been made subservient to the payment of the admitted tax
If the admitted tax is paid and there is proof available that it has been so paid there exists no reason to create a second impediment in the way of the appeal
No doubt rule makes it easy for the assessee to bring satisfactory proof in an uncontestable manner but the provision of the rule is not to the exclusion of other satisfactory modes of proof
Suppose for instance that the I challan was lost and the time for the filing of the appeal was expiring could or could not the person concerned say that he had the certificate but had lost it and that he would produce a copy of the challan from the Treasury or obtain a certificate from the 513 Treasury Officer
Could he not obtain from the bank the discharged cheque by which the amount of tax was deposited by him and produce it as the discharged counterfoil of payment
All those modes of proof will be equally irrefutable
In the present case the assessee had in his petition of appeal stated that the amount of tax had been paid and had fortified the Statement by an affidavit
Before the hearing he produced a certificate from the
Sales tax Officer that the tax had been paid
The Assistant Commissioner ought therefore to have proceeded with the appeal because it was accompanied by satisfactory proof of the payment of the tax
To hold otherwise would put a premium upon a technicality which we do not see will advance the case either for the collection of the tax or for the administration of justice
 The rule as we have stated indicate what is the best and easiest method of achieving satisfactory proof
The certificate from the Sales tax Officer however is as good proof as the challan from the Treasury and if such certificate was produced at the admission of the appeal how the memorandum of appeal can be said to be defective under the section as it stands
In these circumstances we hold that the rule is merely directory and indicates only one of the modes of satisfactory proof
The distinction made by the learned Chief Justice between the tangible and intangible objects does not in our opinion fall for consideration in the present case
If one holds that by entertainment  is meant the time of admission of the appeal satisfactory proof may be furnished at the time of admission of the appeal
We are of opinion that by the word entertain here is meant the first occasion on which the court takes up the matter for consideration
It may be at the admission stage or if by the rules of that Tribunal the appeals are automatically admitted it will be the time of hearing of the appeal
But on the first occasion when the court takes up the matter for consideration satisfactory proof must be presented that the tax was paid within the period by limitation available for the appeal
 In the present case when the Assistant Commissioner took up the appeal for consideration satisfactory proof was available in the shape of a certificate which even today is not denied
In our opinion the Assistant Commissioner was wrong in declining to consider the appeal in the presence of such uncontestable proof
It remains to point out why we did not insist upon the assessee exhausting his other remedies under the Act before coming to this Court
It was made to appear to us that there is a right of revision and right of reference to the High Court  in all such cases and that this remedy was not resorted to by the assessee before making a petition for special leave in this Court
We were taken through a number of cases in which it has been laid down by this Court that this Court will not ordinarily grant special leave to appeal against an order when other remedies are available and LJN6 SCI No 7 514 have not been exhausted
But there is no inflexible rule that this Court will never entertain an appeal and numerous instances have occurred in this Court where such appeals have been admitted
It would have been futile in this
case for the assessee to have gone to the court  of revision which was bound by the ruling of the Allahabad High Court reported in Swastika Tannery of Jaimau v Commissioner of 
Sales tax UP Lucknow 1  and  it would have been equally futile to have
gone to the High Court on a reference
The matter was more easily disposed of by giving special leave in this Court and we therefore felt that this was one of those extraordinary cases in which the ends of justice would be better served by avoiding a circuity of action and by dealing with this matter in this Court directly
It is for this reason that we granted special leave to appeal
The appeal shall therefore be allowed and the appeal shall be remitted to the Assistant Commissioner Judicial 1 Sales Tax Kanpur Range Kanpur for disposal in accordance with law
There shall be no order as to costs
YP Appeal allowed and remitted
1 1963 14 STC 518


Summary:
The appellant assessee filed a memorandum of appeal to the Assistant Commissioner Sales Tax stating therein that the amount of admitted tax had been paid and forfeited the statement by an affidavit
Before the hearing he produced a certificate from the Sales Tax Officer that the tax had been paid
The Assistant Commissioner relying on the Allahabad High Court s decision in Swastika Tannery Jaimau vs Commissioner of Sales tax UP rejected as defective the memorandum of appeal holding that it was not accompanied by the challan showing the deposit of admitted tax under section 9 of the Uttar Pradesh Sales Tax Act 1948 and r 66 of the UP Sales tax Rules
Against this order the assessee directly filed special leave to appeal to this Court without exhausting the remedies of revision and reference provided in the Act
This Court granted Special Leave and HELDThe appeal must be allowed
i By the word entertain in the proviso to section 9 is meant the first occasion on which the Court take up the matter for consideration
It may be at the admission stage or if by the rules of that Tribunal the appeals are automatically admitted it will be the time of hearing of the appeal
But on the first occasion when the court takes up the matter for consideration satisfactory proof must be presented that the tax was paid within the period of limitation available for the appeal
Rule 662 lays down one uncontestable mode of proof which the Court will always accept but it does not exclude the operation of the proviso when equally satisfactory proof is made available to the officer hearing the appeal and it is proved to his satisfaction that the payment of the tax has been duly made and in time
512E F 513E G In the present case when the Assistant Commissioner took tip the appeal for consideration satisfactory proof was available in the shape of a certificate
Swastika Tannery of Jaimau vs Commissioner of Sales tax UP Lucknow 1963 14 STC 518 disapproved
Kundan Lal vs Jagannath Sharma AIR 1962 All 547 Dhoom Chand Jain vs Chaman Lal Gupta and Anr
AIR 1962 All
42 Haji Rahim Bux  Sons  Ors
vs Firm Samiullah  Sons AIR 1963 All 320 approved
ii Though this Court would not ordinarily grant special leave to appeal against an order when other remedies were available and had not been exhausted there is no inflexible rule that this Court will never entertain such an appeal
It would have been futile in this case for the assessee to have gone to the court of revision which was bound by the decision in Swastika Tannery of Jaimau vs
Commissioner of Sales tax UP and it would have been equally 506 futile to have gone to the High Court on a reference
The matter was more easily disposed of by giving special leave in this Court and this was one of those extra ordinary cases in which the ends of justice would be better served by avoiding a circuity of action and by dealing with this matter in this Court directly
513H 514C