Tamil Nadu Iron and Steel Co. vs The State of Tamil Nadu

Sethuraman, J.—These revision petitions have been filed u/s 38 of the Tamil Nadu General Sales Tax Act, 1959, against the order of the

Sales Tax Appellate Tribunal dated 1st November, 1975.

The assessee claimed exemption as second sales contending that the purchases were made locally. The Sales Tax Appellate Tribunal in the

appeals against the assessment years 1970-71, 1971-72 and 1972-73 examined this claim of the assessee and came to the conclusion that the

persons from whom the assessee alleged that it had effected purchases were not real persons. The assessee claimed that with reference to the

impugned purchases there were declaration forms as well as payments by cheques. These aspects were also considered by the Tribunal and it was

found that the declarations had no meaning because the documents were purported to be in the names of persons who were found to be non-

existent, that the registration numbers were fictitious, that the identity of the declarant was not known, the signature was also not otherwise

identified and that as regards the payment by cheque, an opportunity was given to the assessee to ascertain the identity of the recipient of each of

these cases. The assessee did not satisfy the Tribunal about the identity of the persons who encashed the cheques. In these circumstances, the

claim was negatived. Revision petitions (T. C. Nos. 494 to 496 of 1975) were filed before this Court against the said order, and they were

dismissed on 29th October, 1975.

The assessee has filed petitions for review of the earlier order dated 19th August, 1975. Section 36(6) of the Tamil Nadu General Sales Tax

Act provides that the appellant or the respondent may apply for review of any order passed by the Appellate Tribunal under Sub-section (3) on

the basis of the discovery of new and important facts which after the exercise of due diligence were not within his knowledge or could not be

produced by him when the order was made. The time for filing such application for review is one year from the date on which a copy of the order

to which the review application relates was served on the appellant or the respondent, as the case may be. It is in pursuance of this provision, the

assessee purported to file the review petition before the Tribunal.

The Tribunal came to the conclusion that the present case did not come within Section 36(6) of the Act as it was not a case where there was a

discovery of new and important facts which after the exercise of due diligence were not within the knowledge of the applicant or could not be

produced by him when the order was made. It is this order which is challenged in the present revision petitions.

With reference to the fresh facts, there is only one affidavit sworn to by a person named V.A. Manickam. The Tribunal pointed out that the

assessee could not even show a solitary instance of payment of brokerage to V. A. Manickam with reference to the purchases said to have been

made by it. There is also nothing to show that the said Manickam was not available at the time when the appeal was originally heard and that new

and important facts came to light only after he came on the scene after the order of the Tribunal. In the circumstances, we are not satisfied that

there is any new and important fact which after the exercise of due diligence was not within the knowledge of the petitioner and therefore could not

be produced by him when the original order of the Tribunal was made.

In the petition, the point as regards the attraction of Section 36(6)(a) of the Act is raised. It is stated that the words ""on the basis of the

discovery of new and important facts which after the exercise of due diligence were not within his knowledge or could not be produced by him

when the order was made"" showed that it is a cumulative condition, and not an alternative condition. In other words, the point that has been taken

is that the discovery of new and important facts must be after the exercise of due diligence, and that the facts must not have been within the

knowledge of the applicant. Further, according to the assessee, the non-production need not be because of the exercise of due diligence. But a

reasonable construction of the provision would only admit of one interpretation, viz., that the new and important facts discovered must be after the

exercise of due diligence and the facts should not have been within the knowledge of the applicant. Further, the facts should be such as could not

be produced by the applicant when the order was made. The non-production must also be due to some inability after the exercise of due diligence.

Only if after the exercise of due diligence the applicant did not have knowledge of, or was not in a position to produce, the facts, the applicant can

avail himself of the remedy of review. In either event, the facts must be such which came to the knowledge of the assessee subsequently and which

could not be produced after the exercise of due diligence. The requirement of exercise of due diligence applies to both the limits, viz., knowledge

and inability to produce. The result is that the construction sought to be placed by the applicant on Section 36(6) is not correct.

The result is, the revision petitions fail and are dismissed with costs. Counsel''s fee Rs. 250 (one set).