Messers Bahadur Chand Chaman Lal vs The State of Punjab and Others

Dua and Mahajan, JJ.—This is an application u/s 22(2) (b) of the Punjab General Sales Tax Act (No. XLVI of 1948) (hereinafter called the Act) for a direction to the Financial Commissioner to state the case and refer the questions of law arising out of his order dated 5th April, 1962.

The petitioner-firm claiming to be a partnership concern has been registered as a dealer under the Punjab General Sales Tax Act and is engaged in doing commission business dealing in ghee. For the assessment year 1955-56 ending 31st March, 1956, the petitioner-firm filed all the quarterly returns for that year showing a gross turnover of Rs. 21,976/4/6. Certain deductions were claimed on account of sales to registered dealers u/s 5 (2) (b) of the Act. On 24th June, 1957, as is averred in the petition in this Court, the Assessing Authority made additions to the taxable turnover and assessed the petitioner-firm to a total sum of Rs. 9,211,34 nP. thus making an addition of Rs. 8,634.25n P. to the sales tax already paid. The petitioner went up in appeal against the order of assessment but the Deputy Excise and Taxation Commissioner rejected it u/s 20 of the Act on 23rd October, 1958. A revision filed u/s 21 of the Act met the same fate at the hands of Excise and Taxation Commissioner on 27th October, 1961. A further revision was preferred to the Financial Commissioner (Revenue) which was received by him on 23rd February, 1962.

It is stated in paragraph 5 of the petition that an application for a copy of the Commissioner''s order was made on 21st November, 1961 and the same was supplied on 25th November, 1961. On 5th April 1962, the learned Financial Commissioner rejected the revision on the ground that the same was barred by time. It is against this order, which is Annexure ''A'' to the petition, that the petitioner has a grievance. An application was made to the learned Financial Commissioner u/s 22(1) of the Act for referring the questions of law arising from his order but the same was disallowed on 27th July, 1962. In the present petition in this Court, it Is prayed that the learned Financial Commissioner, respondent No. 1, be directed to state the case to this Court and refer the following questions in accordance with the provisions of the Act :

(a) Whether the learned Financial Commissioner was not bound to decide the case on merits in view of the fact that there was no period of limitation prescribed for filing the petition for revision u/s 21(3) of the Punjab General Sales Tax Act, 1948?

(b) Whether the learned Financial Commissioner was justified in dismissing the revision petition in limine on the ground of delay, especially when there is no limitation prescribed?

In support of his contention, our attention has been invited to a decision by Dulat and P. C. Pandit JJ., dated 16th May, 1962 in Messrs Burmah-Shell Oil Storage and Distributing Company of India Ltd. v. The Punjab State G S.T.C. No. 1 of 1961, General Sales Tax Case No. 1 of 1961, where on practically identical facts, a similar petition for mandamus was allowed. The attention of the Bench was also drawn to an earlier decision by Mehar Singh and Gosain, JJ., in Ramji Dass etc. v. The Financial Commissioner G S.T.C. No. 3 of 1958, General Sales Tax Case No. 3 of 1958 decided on 2nd December, 1960, in which, according to Dulat J., who had prepared the order in Messrs Burmah-Shell''s case(supra) somewhat similar question, although in slightly different circumstances, had been ordered to be referred to this Court. Another decision to which the attention of the Bench was drawn in Messrs Kangra Valley Slate Company Ltd, v. The Punjab State G S.T.C. No. 12 of 1958, General Sales Tax Case No. 2 1958, again decided by Mehar Singh and Gosain JJ., on 6th January, 1961, in which the question of the exercise of the discretionary power of the Financial Commissioner to entertain a revision u/s 21 of the Act was not allowed to be referred to this Court, though refusal was based on the ground that the question as framed did not permit a clear answer and the Division Bench took the view that the proposed question could be answered both in the affirmative and in the negative depending on fads. However, the Bench there, in place of the two questions sought to be referred, framed the question reproduced above and directed this question to be referred to this Court with a statement of the case.

The learned counsel for the petitioner has also invited our attention to the decision in the Burmah-Shell Oil Storage''s case, answering the reference made by the learned Financial Commissioner which is reported as Burmah-Shell Oil Storage and Distributing Company of India Ltd., v. The Punjab State 1964 S.T.C. 624. This decision was given by Khanna J. and myself and we did not consider the order of the Financial Commissioner to be wrong in law on account of the inordinate delay in invoking the revisional jurisdiction without furnishing any cogent explanation. Before us, it was argued that the learned Financial Commissioner in the circumstances was not justified in dismissing the revision on the ground that it was filed more than 90 days after excluding the days spent in obtaining copies from the date of the decision of the Commissioner. Khanna J., expressed his opinion on this contention in the following words :

In this respect I am of the view that though the statute has prescribed no period of limitation for filing a revision, there is nothing in the language of section 21 which prohibits the Financial Commissioner from refusing to entertain revision which are filed after a long delay unless a cogent explanation is furnished for that delay. The Financial Commissioner in a number of cases, of which mention has been made in the order of reference, have laid down the rule that revision petitions filed more than 90 days subsequent to the Commissioners'' orders; after excluding the days spent in obtaining copies, should be held to be time-barred unless some good ground was shown for the delay in filing the revisions. It would thus appear that the Financial Commissioners have fixed a period of 91 days within which their revision-al jurisdiction may be invoked. The aforesaid period, in my opinion, is not so short as can be deemed to be unreasonable so as to render the right of approaching the Financial Commissioners in revision illusory.

Reference in that case was also made to Kangra Valley Slate Company Limited Vs. The Punjab State and Another, where a Division Bench had observed that though no period of limitation is prescribed within which a petition for revision must be filed but the revising authorities are vested with discretion in the matter of entertaining such petitions and in suitable cases they are in their discretion entitled to refuse to entertain those which are filed after unreasonable delay. Reference before us was also made to a decision given by me sitting singly in Chaman Lal and Bros. (Private) Ltd. Vs. The Punjab State and Others, , which, according to Khanna J., had proceeded on its own facts. While agreeing with Khanna J., that the reference be answered in the negative, I observed in a separate note that where a right is conferred by Legislature on a party to approach a judicial tribunal for adjudication of a controversy, the fixation of a period of limitation for so approaching would ordinarily also pertain to legislative sphere and the judicial wing of the administration may not legitimately exercise direct legislative power by fixing a rigid period of limitation for exercising the right conferred by the Legislature. Drawing of an arbitrary line of 90 days for all cases, in my opinion, partakes more of a legislative rather than of a judicial function. I also observed in that case that since the assessee''s right to have a reference made to this Court depended on the power of revision in the Financial Commissioner which, according to the plain language, may seem to be discretionary, the discretion should not be absolute and completely free from judicial considerations.

Looking at the order of revision passed by the learned Financial Commissioner on 5th April, 1962, it is obvious that the learned Financial Commissioner has dismissed the revision petition in limine holding that it could not be entertained after the normal period of 90 days for filing such petitions according to the settled practice of that tribunal unless good and convincing reasons are made out for the delay. The approach of the learned Financial Commissioner does seem to us as if he was placing the fixation of 90 days by the practice of that tribunal to be statutory provision which is to be rigidly construed and unless good and genuine reasons are made out for the delay, the revision petition cannot be entertained. This does give rise to the questions of law formulated in the present petition.

For the foregoing reasons, we allow this petition and direct respondent No. 3 to state and refer the case to this Court formulated in the petition. The petitioner will get costs of these proceedings which we fix at Rs. 100.