JUDGMENT [ENTITY], J.
1. Validity of the assessments made under the [ACT] (hereinafter referred to as "the [ACT]") and the [ACT] (hereafter referred to as "the [ACT]"), for the assessment years 1962-63 and 1963-64, is questioned in these tax revision cases, mainly on the ground of bar of limitation. So far as the assessment under the [ACT] is concerned, there is no provision in the Act prescribing the period within which the assessment ought to be completed, but, in the [ACT], there is such a provision, and that constitutes the basis of the petitioner's contention. [SECTION], inter alia, says "an assessment under this section shall be made only within a period of four years from the expiry of the year to which the assessment relates."
2. [SECTION], however, provides for exclusion of certain periods while computing the period of four years, prescribed by sub-section (1). Sub-section (7) reads as follows :
"(7) Where an assessment made under this section has been set aside by any court or other competent authority under this Act for any reason, the period between the date of such assessment and the date on which it has been set aside shall be excluded in computing the period of four years, or six years, as the case may be, specified in this section for the purpose of making any fresh assessment."
3. The real question in these cases is : what is the precise period which is liable to be excluded under sub-section (7) ? For a proper appreciation of this question it is necessary to state the relevant facts.
4. The assessment with respect to the assessment year 1962-63, under both the enactments, was made by the Commercial Tax Officer, Vishakhapatnam, on 31st March, 1964. The Commercial Tax Officer was of the opinion that certain sales effected by the assessee (petitioner herein), which it was calling "compulsory sales", are not exempt from sales tax. With respect to the assessment year 1963-64, he made the assessment on 2nd December, 1964, taking the same view. Against the aforesaid four assessment orders, the assessee preferred appeals before the Assistant Commissioner, Kakinada. The Assistant Commissioner by his order dated 22nd March, 1965, allowed all the appeals, set aside the assessments, and remanded the matters to the Commercial Tax Officer for disposal afresh, in the light of the observations made by him. In pursuance to the order of remand, the Commercial Tax Officer passed fresh order of assessment on 12th December, 1965. This order was in favour of the assessee. Coming to know of this order, the Deputy Commissioner of Commercial Taxes invoked his suo motu power of revision and, after hearing the assessee, passed orders setting aside both the orders of the Assistant Commissioner dated 22nd March, 1965, and the fresh assessment orders passed by the Commercial Tax Officer, in pursuance thereto. The date of the order of the Deputy Commissioner is 3rd May, 1968 ([ACT]), and 8th May, 1968 ([ACT], in the case of the assessment year 1962-63; and 30th December, 1968, and 30th November, 1968, respectively, for the assessment year 1963-64. Against the orders of the Deputy Commissioner, the assessee preferred appeals to the Sales Tax Appellate Tribunal which, by its order dated 16th November, 1973 (in the case of the assessment year 1962-63), and 8th January, 1973 (relating to the assessment year 1963-64), allowed the appeals, set aside the orders of the authorities below, and remitted the matters back to the assessing authority for fresh disposal according to law. The operative portion of the Tribunal's order runs thus :
" The orders of the authorities below in respect of the disputed turnovers in both the appeals now before us, are set aside and the matters to that extent are sent back to the assessing authority for disposal afresh according to law, in the light of the observations made by this Tribunal."
5. Accordingly, the Commercial Tax Officer made fresh assessment, for the assessment year 1962-63. The orders are dated 26th August, 1976 (A.P.G.S.T.), and 10th September, 1976 (C.S.T.). For the assessment year 1963-64, both the orders are dated 30th April, 1976. The assessee again filed appeals before the Assistant Commissioner, Kakinada, but with no success. It then carried the matters in second appeal to the Sales Tax Appellate Tribunal, which dismissed the same by its judgment and order dated 1st December, 1977. The present tax revision cases are directed against this order.
6. The main contention of Mr. [ENTITY], the learned counsel for the petitioner, is that the assessment made on 26th August, 1976, with respect to the assessment year 1962-63, is barred under [SECTION] of the [ACT]. He says that the Tribunal erred in holding that the entire period from 31st March, 1964, to 16th November, 1973 (the date on which the Sales Tax Appellate Tribunal passed its earlier orders), is liable to be excluded under [SECTION]. According to the learned counsel, the only two periods that can be excluded, are (i) the period between 31st March, 1964 (i.e., the date of the original assessment order), and 22nd March, 1965 (the date of the Assistant Commissioner's order in appeal), and (ii) the period between 12th December, 1965 (the date of fresh assessment order passed in pursuance to the order of remand by the Assistant Commissioner), and 3rd May, 1968 (the date of the order of the Deputy Commissioner in revision). We are referring only to the dates of the orders relating to the assessment year 1962-63 under the [ACT], and it may be mentioned that though the dates are different in the case of other assessments, the contention is the same.
7. For the sake of easy reference, we may set out the statement of particulars contained in the order of the Tribunal :
In T.A. No. In T.A. No. In T.A. No. In [CASE NUMBER]
1. Date of origi- 31-3-64 31-3-64 2-12-64 2-12-64 nal assessment by the Commer-
cial Tax Offi-
cer, Visakha-
patnam.
2. Date of Assis- 22-3-65 22-3-65 22-3-65 22-3-65 tant Commiss-
ioner's order in appeal.
3. Date of revi- 12-12-65 14-12-65 14-12-65 14-12-65 sed assessme-
nt order of the Commer-
cial Tax Officer, Vis-
akhapatnam, in pursuance to the Assistant Commissioner's assessment order. 4. Date of the 3-5-68 8-5-68 30-12-68 30-11-68 Deputy Comm- issioner's order in re- vision. 5. Date of the 16-11-73 16-11-73 8-1-73 8-1-73 order of the Sales Tax Appellate Tribunal. 6. Date of the 26-8-76 10-9-76 30-4-76 30-4-76 present ass- essment order under appeal by the Commer- cial Tax Officer, Visakhapat- nam, in pursuance of the remand orders of the Tribunal.
(Note :- [CASE NUMBER] correspond to [CASE NUMBER]. [CASE NUMBER] pertain to the assessment year 1962-63 arising under the [ACT] and the [ACT], respectively. Similarly, [CASE NUMBER] pertain to the assessment year 1963-64 and arise under the [ACT] and the [ACT], respectively.)
8. Now, the rule of limitation contained in [SECTION] of the [ACT] is, undoubtedly, a salutary one. The object is not to keep the assessment pending over an unreasonably long period. All the assessments, it is declared, should be made within a period of four years from the expiry of the year to which the assessment relates, but, at the same time, sub-section (7) provides for exclusion of certain periods while computing the period of four years. The Act provides more than one appeal and revision. [SECTION] provides an appeal against the orders of assessment. [SECTION] confers the powers of revision upon the Commissioner, Deputy Commissioner and some other officers. This power can be exercised suo motu. [SECTION] provides an appeal to the Appellate Tribunal both against an order passed in appeal under [SECTION] and against an order passed by the Deputy Commissioner under [SECTION]. [SECTION] provides a revision to this Court against the orders of the Appellate Tribunal. [SECTION], therefore, says, "where an assessment made under this section has been set aside by any court or other competent authority under this Act for any reason, the period between the date of such assessment and the date on which it has been set aside shall be excluded in computing the period of four years specified in this section for the purpose of making any fresh assessment." Mr. [ENTITY] says that [SECTION], occurring as it does in a taxing enactment should be strictly construed; and if so construed, the only periods which can be excluded are those between 31st March, 1964, and 22nd March, 1965; and 12th December, 1965, and 3rd May, 1968, and none else. He contends that it is unreasonable and unjust to exclude the entire period between 31st March, 1964, and 16th November, 1973, as has been done by the Tribunal. When it was observed by the court that every enactment, including a taxing enactment, has to be construed reasonably, the learned counsel demurred and submitted that the rule is to construe the taxing enactments strictly, and not that they should be construed reasonably. In view of this stand taken by Mr. [ENTITY], we feel it necessary to clarify this aspect first.
9. One of the cardinal rules of interpretation of statutes is that they must be construed reasonably. If, however, on a reasonable construction, more than one interpretation is possible and if it is a taxing enactment, the interpretation which favours the assessee should be adopted. This is what the Supreme Court said in [PRECEDENT] . [ENTITY], J., speaking for the court, observed, "if a provision of a taxing statute can be reasonably interpreted in two ways, that interpretation which is favourable to the assessee, has got to be accepted. This is a well-accepted view of law ". We are of the opinion that a strict interpretation does not mean unreasonable interpretation. The overriding of the Court should be to find out the intendment underlying the enactment and the object it seeks to achieve, and to interpret the words used by it in such a manner as to achieve that intendment and object; and taxing enactments are no exception to this rule. In this context, we may refer to a recent decision of the Supreme Court in [PRECEDENT] . That was also a case where the assessee contended for a strict - in other words, a literal construction of the statute. [SECTION] was introduced in the [ACT], by an Amendment Act of 1948. It conferred revisional powers upon the Commissioner to correct erroneous orders of Income-tax Officers, in so far as they are prejudicial to the interests of the revenue. Sub-section (1) clearly stated that this power could be exercised suo motu. Sub-section (2)(b) prescribed a period of limitation. According to it, no order under sub-section (1) shall be made after the expiry of two years from the date of the order sought to be revised by the Commissioner. Sub-section (3) conferred a right of appeal upon the assessee, against the orders passed by the Commissioner, to the Appellate Tribunal; and sub-section (4) empowered the Tribunal to deal with the order of the Commissioner in such manner as it deems fit, in exercise of its appellate powers, and "to pass such orders thereon as it thinks fit". In the case before the Supreme Court, the assessments made by the assessing authority were revised by the Commissioner under [SECTION] The Commissioner cancelled the assessment orders, and directed the Income-tax Officer, competent in that behalf, to make fresh assessments according to law. The order of the Commissioner was appealed against by the assessee. The Tribunal allowed the appeal on the ground that the Commissioner did not give a reasonable and adequate opportunity to the assessee to present its case and, accordingly, remitted the matter back to him with a direction to dispose it of afresh, after giving due opportunity to the assessee. Against that order, a reference was sought, and made to the High Court of Calcutta. The High Court was of the opinion that the period of limitation contained in sub-section (2)(b) was an absolute one and covered even a revisional order of the Commissioner, passed in pursuance to a direction given by any appellate authority and that, therefore, the Commissioner was not competent to pass any orders after the expiry of two years, even if it is in pursuance to the order of remand made by the Appellate Tribunal. The High Court also observed that there is no provision in the Act removing or relaxing the bar of limitation on the power of the Commissioner. This view was challenged before the Supreme Court by the department and successfully. The following observations of [ENTITY], J., are apposite :
" It is true that sub-section (2)(b) thereof prescribed a period of limitation on his power by providing that no order shall be made under sub-section (1) after the expiry of two years from the date of the order sought to be revised by the Commissioner and a literal construction of sub-section (2)(b) also suggests that the bar of limitation imposed thereby was absolute in the sense that it applied to every kind of order to be made under sub-section (1) and no distinction was made between a suo motu order and an order that might be made by him pursuant to a direction given by any appellate or other higher authority but the question is whether such a literal construction should be accorded to that provision. As stated earlier, sub-section (3) conferred on an assessee a right to prefer an appeal to the Appellate Tribunal against the Commissioner's order made under sub-section (1) and under sub-section (4) the Tribunal had authority to deal with the impugned order of the Commissioner in such manner as it deemed fit in exercise of its appellate powers; for instance, it could confirm the impugned order, it could annul that order, it could after vacating it remand the case back to the Commissioner for making a fresh assessment in the light of the observations made by it in its judgment or it could, after calling for a remand report, rectify the erroneous order of the Income-tax Officer. Further, there was no period prescribed within which an appeal against the impugned order of the Commissioner had to be disposed of by the Tribunal and in the normal course on rare occasions such appeals would have been heard and disposed of before the expiry of two years from the date of the Income-tax Officer's order which was regarded as erroneous by the Commissioner. More often than not such appeals would come up for hearing after the expiry of the said period of two years - a fact fully known and within the contemplation of the legislature when it introduced the section in the Act in 1948. In these circumstances did the legislature intend to attenuate or curtail the appellate powers which it conferred on the Appellate Tribunal in very wide terms under sub-section (4) by enacting sub-section (2)(b) prescribing a time-limit on the Commissioner's power to revise an erroneous order of the Income-tax Officer when then Commissioner was seeking to exercise the same not suo motu but in pursuance of or obedience to a direction from the appellate authority ? According to the construction contended for by the assessee and which found favour with the High Court the answer was in the affirmative because sub-section (2)(b), on its literal construction, was absolute. In our view such literal construction would lead to a manifestly absurd result, because in a given case, like the present one, where the appellate authority (Tribunal) has found, (a) the Income-tax Officer's order to be clearly erroneous as being prejudicial to the interests of the revenue, and (b) the Commissioner's order unsustainable as being in violation of principles of natural justice, how should the appellate authority exercise its appellate powers ? Obviously it could not withhold its hands and refuse to interfere with Commissioner's order altogether, for, that would amount to perpetuating the Commissioner's erroneous order, nor could it merely cancel or set aside the Commissioner's wrong order without doing anything about the Income-tax Officer's order, for, that loud result in perpetuating the Income-tax Officer's order which had been found to be manifestly erroneous as being prejudicial to the revenue. But such result would flow from the view taken by the High Court which has held that the Tribunal acted properly in vacating the Commissioner's order but did not act properly in directing him to dispose of the proceedings afresh after giving opportunity to the assessee. Such manifestly absurd result could never have been intended by the legislature A literal construction placed on sub-section (2)(b) would lead to such manifestly absurd and anomalous results, which, we do not think, were intended by the legislature. These considerations compel us to construe the words of sub-section (2)(b) as being applicable to suo motu orders of the Commissioner in revision and not to orders made by him pursuant to a direction or order passed by the Appellate Tribunal under sub-section (4) or by any other higher authority. Such construction will be in consonance with the principle that all parts of the section should be construed together and every clause thereof should be construed with reference to the context and other clauses thereof so that the construction put on that particular provision makes a consistent enactment of the whole statute "
10. This decision, in our opinion, is a complete answer to the reasoning propounded by the learned counsel. The decision, in clearest terms, says that a literal construction is to be avoided if it is not reasonable or consistent with the intendment and object of the enactment and that a literal or strict construction, as may be called, does not mean an unreasonable construction. To reiterate, the correct principle is the one affirmed by [ENTITY], J., in [PRECEDENT] , viz., where on a reasonable interpretation of a taxing enactment, two views are possible, then the one favouring the assessee should be adopted.
11. Mr. [ENTITY]'s contention echoes the classic statement of [ENTITY], J., in [PRECEDENT]), where the learned Judge said : "In a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used " But, we are not sure whether the said rule continues to be valid, with all its rigour, in the modern times. As observed by the [ENTITY], J., [PRECEDENT] "the tendency of modern decisions upon the whole is to narrow materially the difference between what is called a strict and beneficial construction". Now a few passing reflections. In the light of the Construction we have given to ourselves and the goals set out therein, it is a question to be pondered over by jurists and lawyers alike, whether the rules of interpretation evolved in a different milieu are valid in the present times and conditions in this country. It is also to be examined whether the extreme rules of interpretation propounded by [ENTITY], J., are applicable in the case of enactment, like the [ACT], where the incidence of tax is not directly upon the assessee. Sales tax is an indirect tax. The real incidence is upon the consumer. The assessee or the dealer, as he is called, is really an agent who collects the tax from the consumer and passes it on to the State. It is true that, even if a dealer does not collect the tax from the consumer, either voluntarily or under a mistake of law, he is still not exempt or exonerated from the liability; yet the central fact cannot be ignored that the incidence of tax is not upon the dealer, but upon the consumer. The exceptions may be far and few in between. The experience shows that wherever a dealer is in doubt about the incidence of tax, he construes it in his own favour, and collects the tax from the consumer. The argument of strict or literal construction by such a person sounds hollow. The sales tax enactment is not supposed to be an additional source of revenue to the business world.
12. Bearing the above principles in mind, let us consider the facts of this case. As the table extracted by us above from the order of the Tribunal clearly shows, there has been an unbroken chain of orders by one authority or the other. The original order of assessment was set aside in appeal by the Assistant Commissioner. His order as well as the assessment made in pursuance thereto were set aside by the Deputy Commissioner in revision. The Deputy Commissioner's order was, in turn, set aside by the Tribunal, which remanded the matter back to the assessing authority, expressly stating that it was setting aside the orders of the "authorities below". This is not a simple case where an order of assessment has been set aside in appeal and a fresh assessment has been made and the only period to be excluded is the period between the original order of assessment and the appellate order. Here, there has been one order after the other, each reversing the immediately preceding order. It would be unreasonable and unrealistic to snap this chain of reversal in-between and say that part of it is not covered by sub-section (7). There is no reason why the period between the Assistant Commissioner's order and the Deputy Commissioner's order cannot be excluded, even though the latter order sets aside the former order. Similarly, the Deputy Commissioner's order was, in turn, set aside by the Tribunal, in 1973. There is no reason to look to the order of the authority immediately superior to the assessing authority. As we have stated earlier, the object of sub-section (7) is to exclude the period between the date of assessment and the date of the order setting it aside. In the context, it would mean the final order setting aside the assessment. In this case, the final order setting aside the assessment is that of the Tribunal dated 16th November, 1973.
13. An argument has been addressed to us, saying that the original order of assessment dated 31st March, 1964, was already set aside by the Assistant Commissioner on 22nd March, 1965, and that, on the date of the Tribunal's order (in 1973) the original order of assessment was not subsisting or alive to be set aside. But, this argument ignores the fact that the order which set aside the original assessment was itself, in turn, set aside, and the Tribunal expressly set aside all the orders of the authorities below and remanded the matter for fresh assessment, to the Commercial Tax Officer. We are, therefore, of the opinion that the Tribunal was right in excluding the entire period from 31st March, 1964, to 16th November, 1973; and if so excluded, it is not in dispute that the orders of assessment would be within limitation.
14. Another, though minor, submission of Mr. [ENTITY] is that the Tribunal erred in not excluding the binding charges, specific length charges and dead-length charges from the assessee's turnover. The argument is that these charges are post-sale charges and cannot, therefore, be taken into account for the purpose of assessing the sales tax. But we find that the assessee did not place any material before the appropriate authorities in support of the said contention. Indeed, Mr. [ENTITY] suggested at one stage that we should remand the matter for investigating this aspect. We are, however, not inclined to accede. Having failed to adduce any material establishing that those charges were post-sale charges, the assessee cannot at this stage and at this distance of time, ask for a remand. Accordingly, this contention too is rejected.
15. The tax revision cases, therefore, fail and are dismissed, with costs. Advocate's fee Rs. 100 in each case.
16. Mr. [ENTITY], the learned counsel for the petitioner makes an oral request for leave to appeal to the Supreme Court. We are, however, not satisfied that this case involves any substantial question of law of general importance which requires consideration by the Supreme Court. The oral request is accordingly rejected.
17. Stay of collection of tax which was granted on terms by this Court will continue for a period of one month so as to enable the petitioner to approach the Supreme Court and obtain suitable orders.
18. Petitions dismissed.