State Of Haryana vs M/S Vishal Marbles, Rohtak

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(s). 10792-10794 OF 2011

THE STATE OF HARYANA AND OTHERS ….APPELLANT(S) VERSUS HINDUSTAN CONSTRUCTION COMPANY LTD. ….RESPONDENT(S)

WITH CIVIL APPEAL NO(s).10795 OF 2011 CIVIL APPEAL NO(s).10808 OF 2011 CIVIL APPEAL NO(s).10805 OF 2011 CIVIL APPEAL NO(s).10807 OF 2011 CIVIL APPEAL NO(s).10804 OF 2011 CIVIL APPEAL NO(s).10796 OF 2011 CIVIL APPEAL NO(s).10801-10802 OF 2011 CIVIL APPEAL NO(s).10815-10816 OF 2011 CIVIL APPEAL NO(s).10806 OF 2011 CIVIL APPEAL NO(s).10810 OF 2011 CIVIL APPEAL NO(s).10803 OF 2011 CIVIL APPEAL NO(s).10799 OF 2011 CIVIL APPEAL NO(s).10812 OF 2011 CIVIL APPEAL NO(s).10798 OF 2011 CIVIL APPEAL NO(s).10797 OF 2011 CIVIL APPEAL NO(s).10800 OF 2011 CIVIL APPEAL NO(s).10820 OF 2011 CIVIL APPEAL NO(s).10811 OF 2011 Signature Not Verified CIVIL APPEAL NO(s).10813 OF 2011 Digitally signed by NEETU KHAJURIA CIVIL APPEAL NO(s).10814 OF 2011 CIVIL APPEAL NO(s).10809 OF 2011 Date: 2017.09.15 17:59:05 IST Reason:

CIVIL APPEAL NO(s).10817-10818 OF 2011 CIVIL APPEAL NO(s).10824 OF 2011

1 CIVIL APPEAL NO(s).10830 OF 2011 CIVIL APPEAL NO(s).10829 OF 2011 CIVIL APPEAL NO(s).10828 OF 2011 CIVIL APPEAL NO(s).10826-10827 OF 2011 CIVIL APPEAL NO(s).10825 OF 2011 CIVIL APPEAL NO(s).10821-10823 OF 2011 CIVIL APPEAL NO(s).10831 OF 2011 CIVIL APPEAL NO(s).10837 OF 2011 CIVIL APPEAL NO(s).10833 OF 2011 CIVIL APPEAL NO(s).10832 OF 2011 CIVIL APPEAL NO(s).10834-10835 OF 2011 CIVIL APPEAL NO(s).10840-10841 OF 2011 CIVIL APPEAL NO(s).10838-10839 OF 2011

JUDGMENT

NAVIN SINHA, J.

The common question of law arising for consideration in

this batch of appeals is whether the exercise of revisional

power under Section 40 of the Haryana General Sales Tax Act,

1973 (hereinafter referred to as ‘the Act of 1973’) after its

repeal on 1.4.2003, by the Haryana Value Added Tax, 2003

(hereinafter referred to as ‘the Act of 2003’), is sustainable.

The appeals have, therefore, been heard together and are

being disposed by a common order.

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2. The facts, for better appreciation, shall be culled out from

Civil Appeal Nos.10792-10794 of 2011. The sales tax

assessment of the respondent, for the assessment year

1998-99, was completed and refund ordered on 12.05.2000,

under the Act of 1973. Subsequently, the former Act was

repealed by the Act of 2003 on 01.04.2003. A show cause

notice was issued to the respondent on 07.06.2004 regarding

the refund ordered earlier, in exercise of suo-moto revisional

powers under Section 40 of the Act of 1973. By order dated

12.07.2004, the respondent was held liable for recovery of Rs.

65,35,632/-.

3. The order for recovery having been challenged by the

respondent before the High Court, it was held that resort to

Section 40 of the Act of 1973, after coming into force of the

new Act on 01.04.2003 was unsustainable, as the repeal and

saving clause in Section 61 of the Act of 2003, saved only

pending proceedings under the former. Since there were no

proceedings pending against the respondent under the

repealed Act, on the relevant date, the proceedings thereunder 3 could not be sustained or justified by reference to Section 4 of

the Punjab General Clauses Act, 1898.

4. Sh. Manish Paliwal, learned counsel appearing on behalf

of the State of Haryana, submitted that the refund having

been wrongly obtained, resort to suo-moto revision under

Section 40 of the Act of 1973, exercised within the limitation of

five years, was justified. The wrong benefit of refund clearly

fell within the meaning of the expression privilege, obligation

or liability acquired or incurred under the repealed Act, and

was therefore saved by Section 4 of the Punjab General

Clauses Act, 1898. Relying on Raymond Ltd. and Anr. vs.

State of Chhattisgarh & Ors., (2007) 3 SCC 79, it was

contended that the revisional power conferred on the revenue

in a fiscal legislation should not be construed as a stand-alone

provision, but as a provision intended to enable the revisional

authority to ensure that the assessment had been carried out

in accordance with law. The power vested in the revisional

authority to correct an error in assessment has a direct nexus

with the order of assessment giving finality to the order of the 4 assessing authority. There is a corresponding obligation and

responsibility on the assessee also, and when it is found that

the assessment was otherwise then in accordance with law,

the power of the revisional authority cannot be restricted in

revenue and fiscal matters.

5. Reliance was further placed on Swastik Oil Mills Ltd

vs. H.B. Munshi, Deputy Commissioner of Sales Tax,

Bombay, 1968 (2) SCR 492, and Gammon India Ltd. vs.

Special Chief Secretary and Ors., (2006) 3 SCC 354, in

support of the submission that resort to Section 40 of the Act

of 1973 was saved by reason of Section 4 of the Punjab

General Clauses Act, 1898.

6. Sh. P.H. Parekh, learned Senior Counsel appearing on

behalf of the respondent, urged that the impugned order called

for no interference. The repeal and saving clause in Section

61 of the Act of 2003 exclusively saved pending proceedings

only. The application of the Punjab General Clauses Act,

5 1898, therefore, stood excluded by the expression of a different

intention in the repealing Act. The legislature subsequently

amended Section 61 of the Act of 2003, suitably on

02.04.2010.

7. At the outset, it is appropriate to set out the unamended

and amended provisions of Section 61 of the Act of 2003 to

facilitate better appreciation of issues.

Section 61 of 2003 Act Section 61 of 2003 Act (Before Amendment) (After Amendment) (1) The Haryana General Sales Tax “(1) The Haryana General Sales Tax Act, 1973 (20 of 1973), is hereby Act, 1973 (20 of 1973), is hereby repealed : repealed.

Provided that such repeal shall not-

(a) affect the previous operation of the Act so repealed or anything duly done or suffered thereunder;

or

(b) affect any right, title, privilege, obligation or liability acquired, accrued or incurred under the said Act; or

(c) affect any act done or any action taken (including any appointment, notification, notice, order, rule, form regulation, certificate) in the

6 exercise of any power conferred by or under the said Act,

and any such act done or any action taken in the exercise of the powers conferred by or under the said Act shall be deemed to have been done or taken in the exercise of the powers conferred by or under the said Act as if this Act were in force on the date on which such act was done or action taken; and all arrears of tax and other amount due at the commencement of this Act may be recovered as if the same had accrued under this Act.”

(2) Notwithstanding anything (2) Notwithstanding anything contained in sub-section (1), - contained in sub-section (1), -

(a) any application, appeal, [(a) any application, appeal, revision revision or other proceedings made or other proceedings made or or preferred to any authority under preferred to any officer or authority the said Act, and pending at the under the said Act and pending at commencement of this Act, shall, the commencement of this Act, after such commencement, be shall, after such commencement, be transferred to and disposed of by transferred to and disposed of by the officer or authority who would the officer or authority who would have had jurisdiction to entertain have had jurisdiction to entertain such application, appeal, revision such application, appeal, revision or or other proceedings under this Act other proceedings under this Act as as if it had been in force on the if the said Act had been in force on date on which such application, the date on which such application, appeal, revision or other appeal, revision or other proceedings were made or proceedings were made or preferred. preferred;

Notwithstanding anything to the contrary contained in any judgment, decree or order of any court or other authority, where

7 no review, revision or corrective action could be initiated or finalized in respect of any assessment, order, proceeding under the said Act prior to or after 1st April, 2003, because of judgment or decree of any court or Tribunal and the said assessment or order passed under the said Act had attained finality, the limitation of five years as specified under Section 40 of the said Act shall be deemed to be eight years;”

8. We have considered the respective submissions. A

simple repeal of an Act leaves no room for expression of a

contrary opinion. However, if the repeal is followed by a fresh

enactment on the same subject, the applicability of the

General Clauses Act would undoubtedly require an

examination of the language in the new enactment to see if it

expresses a different intention from the earlier Act. The

enquiry would necessitate an examination if the old rights and

liabilities are kept alive or whether the new Act manifests an

intention to do away with or destroy them. If the new Act

8 manifests a different intention, the application of the General

Clauses Act will stand excluded.

9. There were no proceedings pending against the

respondent under the Act of 1973 when the new Act came into

force on 01.04.2003. The suo-moto revisional power under

Section 40 of the former Act was exercised on 07.06.2004.

The repeal and saving clause in Section 61 of the Act of 2003,

saved only pending proceedings under the repealed Act. The

intendment clearly was that matters which stood closed under

the Act of 1973 had to be given a quietus and could not be

reopened.

10. The assessment under the Act of 1973 having been

completed and refund ordered, the exercise of suo-moto

revisional powers under Section 40 of the same after repeal

was clearly unsustainable in view of the contrary intention

expressed under Section 61 of the Act of 2003, saving only

pending proceedings. Section 4 of the Punjab General Clauses

9 Act, 1858 will have no application in view of the contrary

intendment expressed in Section 61 of the repealing Act. Had

a contrary intention not been expressed, the issues arising for

consideration would have been entirely different. The

observations in State of Punjab vs. Mohar Singh Pratap

Singh, (1955) 1 SCR 893, as extracted below are considered

relevant:-

“8……….Whenever there is a repeal of an enactment, the consequences laid down in Section 6 of the General Clauses Act will follow unless, as the section itself says, a different intention appears. In the case of a simple repeal there is scarcely any room for expression of a contrary opinion. But when the repeal is followed by fresh legislation on the same subject we would undoubtedly have to look to the provisions of the new Act, but only for the purpose of determining whether they indicate a different intention. The line of enquiry would be, not whether the new Act expressly keeps alive old rights and liabilities but whether it manifests an intention to destroy them…..”

The observations in Gammon India Ltd. (supra) at paragraph

73 are to the same effect.

10 11. The legislature, in its wisdom having noticed the

limitation and constraints under Section 61 of the Act of 2003,

made necessary amendments to the same by Act No. 3 of 2010

on 02.04.2010. Any interpretation saving the revisional power

under Section 40 of the Act of 1973, without any proceedings

pending on the relevant date, by resort to Section 4 of the

Punjab General Clause Act, 1858 would render the

amendment redundant, and an exercise in futility, something

which the legislature never intended to do. Such an

incongruous interpretation leading to absurdity has to be

avoided.

12. In Civil Appeal 10840-10841 of 2011, an additional

ground has been urged that the power of review under Section

41 of the Act of 1973 was exercised on 12.8.2003, by the

Deputy Excise and Taxation Officer, to review an order of

assessment dated 4.3.2002. Section 35 of the new Act vested

the power of review in the Tribunal exclusively.

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13. The legislative provisions being different in the precedents

cited on behalf of the appellants, the same have no relevance

to the issue in controversy. The order of the High Court calls

for no interference.

14. The appeals, for reasons discussed, lack merit and are

dismissed.

………………………………….J. (Ranjan Gogoi)

.……….………………………..J. (Navin Sinha) New Delhi, September 15, 2017

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