Case: The State Of Orissa And Another Vs. M/S. Chakobhai Ghelabhai And Company

a rule prescribing fees for appeals and applications in revision was within the legislative competence of the Provincial Legislature. The Act was enacted in 1947and the source of legislative power must be found in the Government of India Act. 199935. Item 48 of List II (Provincial Legislative List) in the Seventh Schedule of the said Act related to "Taxes on the sale of goods" and item 54 read: "Fees in respect of any of the matters in this list, but not including fees taken in any court." Item 1 related inter alia to "constitution and organisation of all courts except the Federal Court, and fees taken therein."The High Court held that the assessing authorities including the Assistant Collector of Sales-Tax and the Collector of Commercial Taxes, Orissa were not courts in the strict sense of the term "Court", though they exercised quasi-judicial functions under the Act. We think that that is a correct view. But it does not necessarily follow that the fees imposed under R. 59 read with S. 29(2) (s) are illegal. Under items 48 and 54 the then Provincial Legislature had power to make a law for taxes on the sale of goods and for fees in respect thereof. Even with regard to Court fees, the Provincial Legislature had power to make a law under item 1.We do not think that S. 29(2) (s) can be held to be bad on the ground of legislative incompetence. Nor do we think that R. 59 goes beyond what is permitted under S. 29(2) (s). The fees imposed are not taxes at all; they come within the expression "other matters (including fees) incidental to the disposal of appeals and applications for revision etc.". We are unable to agree with the High Court that the word "incidental has reference to a matter of casual nature only. The procedure for disposal of an appeal includes as a necessary incidental matter the filing of an appeal on a proper fee. The distinction between a tax and a fee was considered by this Court in Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar, 1954 SCR 1005 : (AIR 1954 SC 282 ) and it is unnecessary to repeat what was said there. We consider that the fees imposed by R. 59 are for services rendered by a governmental agency and though ordinarily fees are uniform, there may be various kinds of fees and it is not possible to formulate a definition that would be applicable to all cases.7. Now, the last finding of the High Court is that the notice under S. 12(5) was not in accordance with law. Here again we think that the High Court was in error. The notice was issued in Form No. VI, which is a combined form for the purposes of Ss. 11 and 12. A foot-note appended to the form required the assessing authority to score out unnecessary words. The High Court points out that this was not done. We are, however, unable to agree with the High Court that the failure to score out unnecessary words made the notice bad in law. The respondent sent a reply to the notice and claimed that it was not a dealer in Orissa. Obviously, the respondent had no difficulty in understanding that the notice was one under S. 12(5) of the Act. The notice stated in terms that the respondent should show cause why a penalty should not be imposed under S. 12(5) of the Act. Section 12(5) as it stood at the relevant time was in these terms :"S. 12 (5). If upon information which has come into his possession, the Collector is satisfied that any dealer has been liable to pay tax under this Act in respect of any period and has nevertheless wilfully failed to apply for registration, the Collector shall, after giving the dealer a reasonable opportunity of being heard, assess, to the best of his judgment, the amount of tax, if any, due from the dealer in respect of such period and all subsequent periods and the Collector may direct that the dealer shall pay, by way of penalty, in addition to the amount so assessed, a sum not exceeding one and a half times that amount."It has been argued before us that one notice was issued for several quarters and an assessment was made for each quarter separately-four quarters on July 4, 1951, and eight quarters on August 29, 1951.This, it is contended, was illegal. We are unable to accept this contention as correct. Section 12(5) talks of a period, and the period may consist of more than one quarter. The return has, however, to be submitted in Form IV which read with R. 20 of the Orissa Sales Tax Rules, 1947, requires the assessee to furnish details of his turn-over for each quarter. The assessment must, therefore, be made on the taxable turn-over of each quarter.8. Lastly, it has been argued that there was no notice under S. 12(5) for the last three quarters and, therefore, for those quarters the assessment orders must be held to be bad. The appellate authority has pointed out that even for the last three quarters the assessing officer, after he had made his orders of assessment in the first five quarters, had directed the respondent to produce his accounts, but no accounts were produced. Section 12(5) enables the assessing authority to make a best judgment assessment for "all subsequent periods" after giving the dealer a reasonable opportunity of being heard. Such an opportunity was given in the present case even in respect of the last three quarters, and we are unable to hold that the assessment for the last three quarters was bad.9. For the reasons given above, we must allow this appeal, set aside the judgment and order of the High Court dated September 5, 1955, and dismiss the writ petition of the respondent. The appellants will be entitled to their costs of the proceedings in the High Court and in this Court.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]We do not agree. The question where a sale is completed depends on facts and is not a pure question ofIt is worthy of note that a no stage subsequent to the admission did the respondent repudiate it or challenge its correctness. Even in the writ petition it was not stated that a wrong admission had been made; on the contrary, the appellate authoritys order in which the admission was set out was an annexure to the writ petition. It is indeed true that in paragraph 13(a) of the writ petition a contention was raised with regard to the sales of theperiod and a reference was made to the Explanation to Art. 286(1) (a) as it then stood. But the necessary averments to attract the Explanation were not made, and nowhere was it stated that the goods were despatched outside Orissa for the purpose of consumption in the delivery State. In other words no foundation was laid for making a distinction between theand post Constitution sales, and with regard to all of them it was admitted that they were completed inadmission which was never repudiated or challenged. We are, therefore, of the opinion that the High Court was clearly in error in its first finding as to the unconstitutionality of the assessment orders made.6. We think that the High Court was also in error in its finding as to the legality of the fees levied on the memorandum of appeal and the application in revision. Section 29 of the Act deals with the rule making power. It statesare unable to accept this contention as correct. Section 12(5) talks of a period, and the period may consist of more than one quarter. The return has, however, to be submitted in Form IV which read with R. 20 of the Orissa Sales Tax Rules, 1947, requires the assessee to furnish details of hisfor each quarter. The assessment must, therefore, be made on the taxableThe appellate authority has pointed out that even for the last three quarters the assessing officer, after he had made his orders of assessment in the first five quarters, had directed the respondent to produce his accounts, but no accounts were produced. Section 12(5) enables the assessing authority to make a best judgment assessment for "all subsequent periods" after giving the dealer a reasonable opportunity of being heard. Such an opportunity was given in the present case even in respect of the last three quarters, and we are unable to hold that the assessment for the last three quarters was bad.9. For the reasons given above, we must allow this appeal, set aside the judgment and order of the High Court dated September 5, 1955, and dismiss the writ petition of the respondent. The appellants will be entitled to their costs of the proceedings in the High Court and in this Court.