Assistant Commercial Tax Officer vs M/S Rijhumal Jeevandas

Assistant Commercial Tax Officer ...Appellant

Versus

M/s. Rijhumal Jeevandas ...Respondent

WITH

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12891 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Ajit Singh Chandra Prakash ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12893 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Raj Timber Mart ...Respondent CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12896 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Ashok Timber Merchant ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12897 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Narayan Das Aadu Mal ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12899 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahadev Timber & Furniture ...Respondent

2 CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12902 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahadev Timber & Furniture ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12903 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahadev Timber & Furniture ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12906 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahadev Timber & Furniture ...Respondent

CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12909 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahaveer Timber Merchant ...Respondent

3 CIVIL APPEAL ......... OF 2010 (@ SLP (C) NO. 12912 OF 2009)

Assistant Commercial Taxes Officer ...Appellant

Versus

M/s. Mahaveer Timber Merchant ...

Respondent

JUDGMENT

Swatanter Kumar, J.

1. Leave granted.

2. With the consent of counsel appearing for the parties, the matters

are heard for final disposal. By this judgment we will dispose of

all the aforenoticed appeals as common question of law on

somewhat similar facts arises for consideration of this Court in all

these appeals. However, for the purpose of brevity and to avoid

repetition of facts, we would be referring to the facts of SLP (C)

No. 11103 of 2009.

4

3. All these aforenoticed appeals, though refer to different

respondents, all being timber merchants but the principal question

raised in all these appeals is identical, whether the `ballies' can

fall under the expression `timber' so as to justify levying of higher

sales tax.

4. M/s. Rijhumal Jeevandas (hereinafter referred to as `the assessee')

is a concern, trading in `timber' and its allied products. The

Assessing Officer vide his Order dated 17th November, 2000,

passed an order of assessment against the assessee wherein he

levied tax at the rate of 8% i.e. Rs. 5,75,580/- on the `ballies'

which, according to the Department, comes within the category of

`timber' and thus, the tax ought to have been levied at the rate of

12%. On this premise, a notice was issued by the authority for

amending the assessing order under Section 37 of the Rajasthan

Sales Tax Act, 1994 (for short `the Act'). Despite service of

notice, none had appeared on behalf of the assessee and the

differential tax at the rate of 4% was levied totaling to Rs.

23,023/-. Further, the authorities imposed surcharge of Rs.

5 2,763/- and interest of Rs. 26,302/-, and raised a total further

demand of Rs. 52,088/-.

5. Against the aforesaid order of assessment, the assessee preferred

an appeal before the Deputy Commissioner (Appeals),

Commercial Tax Department, Kota. The main argument raised

was that the order was beyond the purview and scope of Section

37 of the Act. The `ballies' could not be treated to be covered

under the head `timber' and, as such, the entire demand was

vitiated in law.

6. The aforesaid appeal was allowed. The appellate authority found

that, the `ballies' comes under the category of `goods' and not

under the category of `building goods'. Thus, the differential tax

levied by the Tax Assessment Officer, assuming `ballies' to be

`timber' was not justified. Consequently, the entire demand itself

was set aside.

7. The order of the appellate authority dated 18th October, 2006 was

challenged by the Assistant Commercial Taxes Officer, Ward -III,

Circle-B, Kota, before Rajasthan Tax Board, Ajmer which vide its

6 judgment dated 11th June, 2007 found that the `ballies' are not

`timber' and upheld the view taken by the First Appellate

Authority and dismissed the appeals preferred by the Department.

8. Aggrieved by the Order of the Rajasthan Tax Board, Ajmer the

Department preferred a revision under Section 86 of the Act and

besides referring to the facts, the following questions of law were

framed for consideration of the High Court :

"(i) Whether in the facts and circumstances of the matter the order passed by the assessing authority was in any manner inappropriate for the purpose of interference by the appellate authorities ?

(ii) Whether the Appellate Authorities were justified in interfering with the orders passed by the assessing authority which related to appreciation of entire record and facts ?

(iii) Whether the appellate authorities justifies in drawing the wrong conclusion while misinterpreting the provisions of the Section 37 of the Act of 1994 which relates to rectification of an order ?

(iv) Whether the goods/good used and dealt with by the respondent assesses could be classified as not timber so as to enable the respondent assesses to pay tax @ 8% while bally comes in the category of timber wood and upon which the tax is payable @ 12%?"

7 9. This revision petition came to be dismissed by the High Court

vide its Order dated 7th July, 2008. The said Order reads as under

:

"After having carefully gone through material on record, since after due consideration proper discretion has already been used by the Deputy Commissioner (Appeals) as also the Rajasthan Tax Board, in the facts and circumstances, no further interference is called for by this Court.

The revision petition is dismissed accordingly as having no merits."

10. The present appeals had been preferred by the Department against

the order dated 7th July, 2008 passed by the High Court. The

primary challenge, to the legality and correctness of the order, is

that there is no discussion either on the facts or on the questions of

law raised in the revision petition before the High Court and in the

argument addressed during the time of hearing of the revision

petition.

11. With some regret, we are constrained to notice that the cryptic

orders like the above, have not only been passed in the present

appeals, but identical orders had even been passed by the High

8 Court in large number of cases from which the appeals have been

preferred before this Court. Identical orders, though in different

revision petitions dealing with different facts, parties and

questions of law, running into 4 lines, like the present one, have

been passed, even without variation of a coma or a full stop. It

also needs to be noticed that the grounds raised by the Department

before us cannot be said to be frivolous or untenable which

required discussion by the High Court. The orders, besides being

cryptic, suffer from basic infirmity of non application of mind and

non-speaking orders in law. This ground need not detain us any

further as even in other cases where identical orders were passed,

this Court had the occasion to consider the same grounds at some

length. Reference, in this regard, can be made to the judgment of

the date, the Bench, in the case of Assistant Commissioner v. M/s

Shukla & Brothers (SLP (C) No. 16466 of 2009) decided on the

same day, where after discussing the law at some length, the order

passed by the High Court was set aside and the case was

remanded to the High Court for hearing the case de novo and

passing of an order in accordance with law afresh.

9

12. In view of the ratio of the case of M/s. Shukla & Brothers (supra),

which is squarely applicable on the fact and law to the present

case, we are constrained to set aside the order passed by the High

Court and remand the matter to the High Court for hearing the

case de novo. We are compelled to make this direction as it was

expected of the High Court to consider the question of law raised

before it and express its own opinion/reasons.

13. For the reasons stated above and the reasons recorded in the case

of M/s. Shukla & Brothers (supra), we hereby set aside the

impugned orders of the High Court and remand the matters to

the High Court for hearing the same de novo and pass orders in

accordance with law. However, in the facts and circumstances of

the case, there shall be no order as to costs.

To that extent the appeals are allowed.

........................................J. [ S.H. KAPADIA ]

10 ........................................J. [ SWATANTER KUMAR ] New Delhi April 15, 2010

11