Case: State Of U.P Vs. Dyer Meakin Breweries Ltd

years. The validity of those assessments have not been questioned at any stage. The registration of the assessee was transferred from Ghaziabad to Lucknow only on March 28, 1960. Till that date, the assessee continued to be registered as a dealer in the office of the Sales Tax Officer, Ghaziabad. The penalty proceedings had been initiated on January 8, 1960 i.e. long before the assessees registration was transferred from the Sales Tax Officer, Ghaziabad, to the Sales Tax Officer, Lucknow.4. The High Court came to the conclusion that when the penalty was actually imposed on the assessee, the Sales Tax Officer, Ghaziabad, had no jurisdiction over the assessee and hence the levy made was invalid. We shall presently examine the correctness of that conclusion. But, before doing so, it would be convenient to dispose of a new contention advanced by Mr. Singh, the learned counsel for the assessee. Mr. Singh contended that the registration of the assessee as a dealer before the Sales Tax Officer, Ghaziabad, was an invalid registration as the U. P. Sales Tax Act as well as the Central Sales Tax Act did not permit double registration of the same assessee. According to him, the assessees head office was at all times at Lucknow. This is an entirely a new contention. No such contention appears to have been taken either before the authorities under the Act or before the High Court. On the basis of the material on record it is not possible to come to a firm conclusion that the same assessee had been registered at two places. Further, there is no material before us to show that during the relevant assessment years the assessees head office was at Lucknow. These are essentially questions of fact. We cannot go into those questions at this stage. Hence, we do not propose to go into the contention that the assessees registration at Ghaziabad was invalid. We have to proceed on the basis that the assessee was properly registered as a dealer at Ghaziabad. If that was not so, the assessee would not have applied to the Sales Tax Officer, Ghaziabad, for registration; nor would it have submitted its sales tax returns to that officer. As mentioned earlier, the sales tax assessments for the years 1958-59 and 1959-60 were not challenged as being unauthorised.5. This takes us to the question whether under Section 10-A of the Act, the Sales Tax Officer, Ghaziabad, had competence to levy penalty on the assessee. We shall first read Section 10 of the Act to the extent it is material for our present purpose. That section says:"10 If any person-(a) ............(b) being a registered dealer falsely represents when purchasing any class of goods that goods of such class are covered by his certificate of registration; or(c) ............(d) ............(e) ............(f) ............he shall be punishable with simple imprisonment which may extend to six months, or with fine, or with both, and when the offence is a continuing offence, with a daily fine which may extend to fifty rupees for every day during which the offence continues."6. Section 10-A (1) says:If any person purchasing goods is guilty of an offence under cl. (b) or clause (c) or clause (d) of S. 10, the authority who granted to him or, as the case may be, is competent to grant to him a certificate of registration under this Act may, after giving him a reasonable opportunity of being heard, by order in writing, impose upon him by way of penalty a sum not exceeding one-and-a-half times the tax which would have been levied under this Act in respect of the sale to him of the goods if the offence had not been committed;Provided that no prosecution for an offence under Section 10 shall be instituted in respect of the same facts on which a penalty has been imposed under this section."(emphasis supplied).7. There is no dispute that the authority who granted the certificate of registration was the Sales Tax Officer, Ghaziabad. Therefore, prima facie, he was competent to levy penalty on the assessee. But it was contended on behalf of the assessee that on March 28, 1960, the registration before the Sales Tax Officer, Ghaziabad, stood cancelled and thereafter the assessee was registered before the Sales Tax Officer, Lucknow. That being so, the Sales Tax Officer, Ghaziabad, had no jurisdiction to levy penalty on the assessee. This contention overlooks the language of Section 10-A. That section definitely says that the authority who granted the certificate of registration to an assessee is one of the authorities competent to levy penalty. Undoubtedly, the Sales Tax Officer, Ghaziabad, was the authority who granted the the certificate of registration to the assessee and that certificate was in force during the assessment years 1958-50 and 1959-60. Even though after March 28, 1960, he ceased to be the authority competent to grant certificate of registration to the assessee, he still had the competence to levy penalty on the assessee in view of the fact that it was he who had granted the certificate of registration to the assessee. In this case, we are dealing with the penalty relating to offences committed during the assessment years 1958-59 and 1959-60. In fact the levy of penalty is one form of levying tax. If the Sales Tax Officer was competent to levy sales tax on the assessee in respect of those assessment years, he was equally competent to levy penalty on the assessee in respect of the offences committed during those years. In our opinion, the High Court did not properly appreciate the legal position in this case. The High Court was wrong in thinking that the proceedings initiated on January 8, 1960, stood terminated as a result of the subsequent notices issued by the Sales Tax Officer. The notices issued by him are not statutory notices. Under Section 10-A of the Act, the Sales Tax Officer was only required to give reasonable opportunity to the assessee to show cause why penalty should not be imposed on him.8.

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

Explanation:
1[ds]No such contention appears to have been taken either before the authorities under the Act or before the High Court. On the basis of the material on record it is not possible to come to a firm conclusion that the same assessee had been registered at two places. Further, there is no material before us to show that during the relevant assessment years the assessees head office was at Lucknow. These are essentially questions of fact. We cannot go into those questions at this stage. Hence, we do not propose to go into the contention that the assessees registration at Ghaziabad was invalid. We have to proceed on the basis that the assessee was properly registered as a dealer at Ghaziabad. If that was not so, the assessee would not have applied to the Sales Tax Officer, Ghaziabad, for registration; nor would it have submitted its sales tax returns to that officer. As mentioned earlier, the sales tax assessments for the years 1958-59 and 1959-60 were not challenged as beingis no dispute that the authority who granted the certificate of registration was the Sales Tax Officer, Ghaziabad. Therefore, prima facie, he was competent to levy penalty on thebeing so, the Sales Tax Officer, Ghaziabad, had no jurisdiction to levy penalty on the assessee. This contention overlooks the language of Section 10-A. That section definitely says that the authority who granted the certificate of registration to an assessee is one of the authorities competent to levy penalty. Undoubtedly, the Sales Tax Officer, Ghaziabad, was the authority who granted the the certificate of registration to the assessee and that certificate was in force during the assessment years 1958-50 and 1959-60. Even though after March 28, 1960, he ceased to be the authority competent to grant certificate of registration to the assessee, he still had the competence to levy penalty on the assessee in view of the fact that it was he who had granted the certificate of registration to the assessee. In this case, we are dealing with the penalty relating to offences committed during the assessment years 1958-59 and 1959-60. In fact the levy of penalty is one form of levying tax. If the Sales Tax Officer was competent to levy sales tax on the assessee in respect of those assessment years, he was equally competent to levy penalty on the assessee in respect of the offences committed during those years. In our opinion, the High Court did not properly appreciate the legal position in this case. The High Court was wrong in thinking that the proceedings initiated on January 8, 1960, stood terminated as a result of the subsequent notices issued by the Sales Tax Officer. The notices issued by him are not statutory notices. Under Section 10-A of the Act, the Sales Tax Officer was only required to give reasonable opportunity to the assessee to show cause why penalty should not be imposed on him.