Case: Thansingh Nathmal &amp; Others Vs. The Superintendent of Taxes, Dhubri &amp; Others

brought into the market for sale, that the goods sold were within the Province on the dates of contracts and therefore the price thereof was liable to be included in the taxable turnover. The High Court, as we have already observed, took the view that the finding of the Commissioner was not "altogether unjustified", nor could it be said that the Commissioner and the other taxing authorities "were not quite conscious of" the requirements which attracted the application of the Explanation to S. 2(12) and declined to enter upon a reappraisal of the evidence which in the view of the High Court the taxing authorities alone were competent to enter upon.12. In these appeals Mr. Setalvad on behalf of the appellants contends that there is clear evidence on the record to show that even applying the test laid down by the Commissioner some of the contracts of sale were made before the goods were marketable and therefore the view taken by the taxing authorities that the goods were at the date of the contract in existence within the Province of Assam was "without any foundation". Counsel also submitted that some of the contracts related to jute grown in Pakistan and with respect of those contract also the assumption made by the Commissioner that the goods were within the State of Assam at the date of the contract of sale could not be warranted. Counsel then said that the description of the goods in the contracts of sale indicated that they related to bales whereas the contracts for purchase by the appellants were in respect of loose jute and as the goods purchased were not identical or ascertainable with reference to the contracts of sale made by the appellants, liability to pay tax was not attracted under S. 2(12) of the Act. We are unable to entertain these pleas because they were never raised before the Superintendent of Taxes and the Assistant Commissioner and no evidence was produced by the appellants to support those pleas. Before the Commissioner it was broadly urged that the goods in respect of the contracts could not have been in existence within the Province at the date of the respective contracts of sale but that argument was for reasons already mentioned rejected by the Commissioner and the High Court declined to allow the question whether the findings of the Commissioner were "speculative" to be agitated. The appellants now seek to plead that the taxing authorities were in error in holding that the goods conformed to the conditions as to the situs of the goods at the dates of the contracts of sale, prescribed by S. 2(12) so as to make the price liable to be included in the taxable turnover. The legislature has entrusted power to ascertain facts on which the price received on sales becomes taxable, to the authorities appointed in that behalf with right of recourse to the High Court on questions of law arising out of the order of the Commissioner of Taxes. It is therefore contemplated by the Legislature that all material evidence on which a tax-payer relies to justify his claim that his transactions are not taxable, should be placed before the taxing authorities so that they may have an opportunity to adjudicate upon the claim. If after a proper trial, the claim is negatived, because the facts on which it is founded are not proved, the proceedings must end.13. If, however, the adjudication of the Commissioner is vitiated because there is no evidence to support it or it is based on conjectures, suspicions or irrelevant materials, or the proceedings of the taxing authorities are otherwise vitiated so that there has been no fair trial, the High Court may undoubtedly advise the Commissioner on questions properly referred to it in the manner provided by the Act. But the High Court cannot be asked to assume the role of an appellate authority over the decision of the Commissioner on questions of fact or even of law.14. Assuming that there is some substance in the contention that the adjudication by the Commissioner proceeded on grounds which the appellants characterised as "speculative", it was open to them to resort to the machinery provided by the Act, and having failed to do so, they could not ask the High Court to act as an appellate authority in clear violation of the statutory provisions and to bypass the machinery provided by the Act.15. We accordingly decline to entertain the application to raise questions other than those raised by the certificate granted by the High Court, because the questions sought to be raised are questions of facts which were not canvassed at the appropriate stage before the taxing authorities and the machinery provided under the Act for determination of questions relating to liability to tax is attempted to be bypassed.16. The constitutional question on which certificate was granted does not need consideration in any detail. By the Explanation to S. 2(12) of the Act notwithstanding anything to the contrary contained in the provisions of the Indian Sale of Goods Act, 1930, a sale is deemed to be complete when the goods are actually within the State of Assam at the time when the contract of sale is made, irrespective of the place where the contract is made. Under the Sale of Goods Act, 1930, in the absence of a contract to the contrary a sale is complete when property in the goods passes, but by the Assam Sales Tax Act the Legislature has attempted to locate the situs of sale for the purpose of levy of sales-tax by fixing upon the actual situation of the goods within the Province at the date of the contract for the purposes of levying tax on sales. The Legislature has thereby not overstepped the limits of its authority: Tata Iron and Steel Co. Ltd. v. State of Bihar, 1958 SCR 1355 : (AIR 1958 SC 452 ). No argument has therefore been advanced before us to support the plea of unconstitutionality.17.

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

Explanation:
0[ds]We have heard counsel for the appellants at great length upon this application for leave to appeal on grounds other than constitutional on which the certificates were granted by the High Court. After carefully considering the arguments, we are of the view that no case has been made out for acceding to that request. A person appealing to this Court under Art. 132 of the Constitution may not challenge the correctness or propriety of the decision appealed against on grounds other than those on which the certificate is granted, unless this Court grants him leave to raise other questions. Such leave is generally granted where the trial before the High Court has resulted in grave miscarriage of justice or where the appeal raises such substantial questions, that on an application made to this Court under Art. 136 of the Constitution leave would be granted to the applicant to appeal against the decision on those questions.In the present case the appellants had the right to move the Commissioner to refer a case to the High Court under S. 32 of the Act, and to move the High Court if the Commissioner refused to refer the case. But they did not do so and moved the High Court in its jurisdiction under Art. 226 of the Constitution, and invited the High Court to re-open the decision of the taxing authorities on question of fact, which jurisdiction by the statute constituting them is exclusively vested in the taxing authorities. This they did without even raising the questions before the Superintendent of taxes and the Assistant Commissioner.The appellants who are dealers registered under the Assam Sales Tax Act submitted their returns to the Superintendent of Taxes, but failed when called upon to produce their books of account and other evidence in support of their returns. Even before the Assistant Commissioner, they produced some but not all their book account and evidence demanded by the Superintendent. By the Explanation to S. 2(12) of the Act the expression sale notwithstanding anything contained inthe Indian Sale of Goods Act, 1930, includes sale of any goods which are actually in the Province at the time when the contract of sale in respect thereof is made, irrespective of the place where the said contract is made and such sales are deemed for the purposes of the Act to have taken place in the province. Under the Indian Sale of Goods Act, a sale takes place when property in the goods passes. But for the purposes of the Assam Sales Tax Act situation of the goods is seized by the Legislature for the purpose of fictionally regarding the sale as having taken place within the Province of Assam if at the time of the contract of sale the goods are within the Province. Liability to sales-tax in respect of the goods where the transfer in the property of the goods where the transfer in the property of the goods has taken place outside the Province of Assam undoubtedly arose if the conditions prescribed by the Explanation, exist: viz., the goods are actually in the Province when the contract of sale is made and not otherwise. But the question whether the goods at the date of the contract of sale were actually in the Province is a question of fact which had to be determined by the sales-tax authorities. Before the Superintendent of Taxes liability to pay tax was challenged but it does not appear to have been contended that at the time of the contract of sale, the goods were not actually within the Province, and no such contention appears to have been even raised before the Assistant Commissioner of Taxes. Before the Commissioner in the revision application filed by the appellants it was urged that part of the goods the price of which was sought to be included in the turnover were not within the Province at the time of the contract of sale and therefore the price of those goods could not be taken into account in computing the taxable turnover. The Commissioner held having regard to the "time-table of cultivation of jute" and the time when the jute is brought into the market for sale, that the goods sold were within the Province on the dates of contracts and therefore the price thereof was liable to be included in the taxable turnover. The High Court, as we have already observed, took the view that the finding of the Commissioner was not "altogether unjustified", nor could it be said that the Commissioner and the other taxing authorities "were not quite conscious of" the requirements which attracted the application of the Explanation to S. 2(12) and declined to enter upon a reappraisal of the evidence which in the view of the High Court the taxing authorities alone were competent to enterare unable to entertain these pleas because they were never raised before the Superintendent of Taxes and the Assistant Commissioner and no evidence was produced by the appellants to support those pleas. Before the Commissioner it was broadly urged that the goods in respect of the contracts could not have been in existence within the Province at the date of the respective contracts of sale but that argument was for reasons already mentioned rejected by the Commissioner and the High Court declined to allow the question whether the findings of the Commissioner were "speculative" to be agitated. The appellants now seek to plead that the taxing authorities were in error in holding that the goods conformed to the conditions as to the situs of the goods at the dates of the contracts of sale, prescribed by S. 2(12) so as to make the price liable to be included in the taxable turnover. The legislature has entrusted power to ascertain facts on which the price received on sales becomes taxable, to the authorities appointed in that behalf with right of recourse to the High Court on questions of law arising out of the order of the Commissioner of Taxes. It is therefore contemplated by the Legislature that all material evidence on which a tax-payer relies to justify his claim that his transactions are not taxable, should be placed before the taxing authorities so that they may have an opportunity to adjudicate upon the claim. If after a proper trial, the claim is negatived, because the facts on which it is founded are not proved, the proceedings must end.If, however, the adjudication of the Commissioner is vitiated because there is no evidence to support it or it is based on conjectures, suspicions or irrelevant materials, or the proceedings of the taxing authorities are otherwise vitiated so that there has been no fair trial, the High Court may undoubtedly advise the Commissioner on questions properly referred to it in the manner provided by the Act. But the High Court cannot be asked to assume the role of an appellate authority over the decision of the Commissioner on questions of fact or even of law.Assuming that there is some substance in the contention that the adjudication by the Commissioner proceeded on grounds which the appellants characterised as "speculative", it was open to them to resort to the machinery provided by the Act, and having failed to do so, they could not ask the High Court to act as an appellate authority in clear violation of the statutory provisions and to bypass the machinery provided by the Act.We accordingly decline to entertain the application to raise questions other than those raised by the certificate granted by the High Court, because the questions sought to be raised are questions of facts which were not canvassed at the appropriate stage before the taxing authorities and the machinery provided under the Act for determination of questions relating to liability to tax is attempted to be bypassed.The constitutional question on which certificate was granted does not need consideration in any detail. By the Explanation to S. 2(12) of the Act notwithstanding anything to the contrary contained in the provisions ofthe Indian Sale of Goods Act, 1930, a sale is deemed to be complete when the goods are actually within the State of Assam at the time when the contract of sale is made, irrespective of the place where the contract is made. Underthe Sale of Goods Act, 1930, in the absence of a contract to the contrary a sale is complete when property in the goods passes, but by the Assam Sales Tax Act the Legislature has attempted to locate the situs of sale for the purpose of levy of sales-tax by fixing upon the actual situation of the goods within the Province at the date of the contract for the purposes of levying tax on sales. The Legislature has thereby not overstepped the limits of its authority: Tata Iron and Steel Co. Ltd. v. State of Bihar, 1958 SCR 1355 : (AIR 1958 SC 452 ). No argument has therefore been advanced before us to support the plea of unconstitutionality.