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PETITIONER: SALES TAX OFFICER

       Vs.

RESPONDENT: K. I. ABRAHAM

DATE OF JUDGMENT: 07/04/1967

BENCH: RAMASWAMI, V. BENCH: RAMASWAMI, V. SHAH, J.C. SIKRI, S.M.

CITATION:  1967 AIR 1823            1967 SCR  (3) 518  CITATOR INFO :  RF         1985 SC 421  (20,55)

ACT: Central Sales Tax Act, 1956 (74 of 1956) Ss. 8(4), 13(3) and -(4)Declaration  Forms  filed after  prescribed  time  under Rules-If s. 8(4) complied with. Central  Sales  Tax  (Kerala) Rules,  1957-Rule  6(1)  third proviso, validity.

HEADNOTE: Sales-tax  under  s. 8 of the Central Sales-tax Act  at  the rate  of  7%  was imposed on  assessee’s  sales,  for  which declaration  forms ’C’ was filed after the  prescribed  date but  before the order of assessment was made.  The  assessee filed a writ petition against the assessment, which the High Court allowed.  In appeal, this Court, Held:  The third proviso to Rule 6(1) of the  Central  Sales Tax  (Kerala) Rules, is ultra vires of s. 9(4) read with  s. 13(3) and (4) of the Central Sales Tax Act.  The phrase  "in the prescribed manner" occurring in s. 8(4) of the Act  only confers  power on the rule making authority to  prescribe  a rule  stating  what particulars are to be mentioned  in  the prescribed form, the nature and value of the goods sold, the parties  to whom they are sold, and to which  authority  the form is to be furnished.  But the phrase "in the  prescribed manner"  in s. 8(4) does not take in the  time-element.   In other words, the section does not authorise the  rule-making authority  to  prescribe a time-limit within which  the  de- claration  is to be filed by the ’registered  dealer.   This view is supported by the language of s. 13(4) (g) of the Act which  states that the State Government may make  rules  for "the  time  within  which,  the  manner  in  which  and  the authorities  to  whom  any change in the  ownership  of  any business  or  in the name, place or nature of  any  business carried on by any dealer shall be furnished." This makes  it clear  that the Legislature was conscious of the  fact  that the  expression "in the manner" would de note only the  mode in which an act was to be done, and if any time limit was to be prescribed for the doing of the act, specific words  such as "the time within which" were also Therefore the  assesses was not bound ’O before the prescribed time in the any  such

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time-limit  it  was  the duty option in Form  ’C’  within  a reasonable  time and in the present case it is the  admitted position  that  the assessee did  furnish  the  declarations before the order of assessment was made. [522-F-523 A; 524D- E] Acraman v. Herniman 117 E.R. 1164, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 404 of 1966. Appeal  by special leave from the judgment and  order  dated November 29, 1963 of the Kerala High Court in O.P. No.  2165 of 1962. B.   R.  L.  lyengar  and  M. R.  Krishna  Pillai,  for  the appellants. 519 The respondent did not appear. The Judgment of the Court was delivered by Ramaswami, J. This appeal is brought, by special leave, from the judgment   of  the High Court of Kerala  dated  November 29, 1963 in Writ    Petition, O.P. No. 2165 of 1962. The  respondent  (hereinafter called the ’assessee’)  was  a dealer  in Cocoanut oil business having  inter-State  sales. For the year 1959-60 the assessee was assessed to  sales-tax under  s. 8 of the Central Sales Tax Act (Act 74 of  1.956), hereinafter  called the ’Act’.  Out of a total  turnover  of Rs.  2,30,990 and odd determined by the Sales  Tax  Officer, only  a sum of Rs. 1,89,734 and odd was supported by  proper declaration  Form  ’C’.  Tax was therefore  imposed  by  the Sales Tax Officer at the rate of 1 % on the turnover of  Rs. 1,93,346  and at 7% on the balance, namely Rs. 37,645.   The assessee did not file the declaration forms on or before the prescribed  date,  i.e., February 16, 1961 but  he  actually filed  the  declaration forms on March 8,  1961  before  the order  of assessment was made, the delay being explained  as due  to  late  receipt of the  declaration  forms  from  the purchaser  in Madras.  The assessee preferred an  appeal  to the  Appellate  Assistant Commissioner but  the  appeal  was dismissed.  The assessee took the matter in revision  before the  Deputy  Commissioner  of  Sales-tax  but  the  revision petition was dismissed.  Thereafter, the assessee moved  the Kerala High Court for grant of a writ under Art. 226 of  the Constitution  for  quashing  the orders  of  the  Sales  Tax Officer  dated June 13, 1961 and the order of the  Appellate Assistant  Commissioner  dated December 13,  1961.   By  its order  dated November 29, 1963, the High Court  allowed  the writ  petition  of the assessee and quashed  the  orders  of assessment  of sales-tax and directed the Sales Tax  Officer to  make  a  fresh order of  assessment  after  taking  into consideration  the declaration forms furnished by the as  on March 8, 1961. Section 8 of the Act, as it stood on the material date,  was to the following effect:               "8.  (1)  Every dealer, who in the  course  of               interState trade or commerce-               (a)   sells to the Government any goods; or               (b)   sells to a registered dealer other  than               the   Government  goods  of  the   description               referred to in subsection (3);               shall  be  liable to pay tax under  this  Act,               which shall be one per cent. of his turnover.               (2)   The  tax  payable by any dealer  on  his               turnover in so far as the turnover or any part               thereof relates

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             520               to  the sale of goods in the course of  inter-               State  trade  or commerce not  falling  within               sub-section (1)-               (a)   in the case of declared goods, shall  be               calculated at the rate applicable to the  sale               or   purchase   of  such  goods   inside   the               appropriate State; and               (b)   in the case of goods other than declared               goods,  shall  be calculated at  the  rate  of               seven  per cent. or at the rate applicable  to               the sale or purchase of such goods inside  the               appropriate State, whichever is higher;               and  for  the  purpose  of  making  any   such               calculation any such dealer shall be deemed to               be a dealer liable to pay tax under the  sales               tax    law   of   the    appropriate    State,               notwithstanding that he,. in fact, may not  be               so liable under that law.               (4)   The  provisions  of sub-section  (  1  )               shall  not apply to any sale in the course  of               inter-State  trade  or  commerce  unless   the               dealer  selling  the goods  furnishes  to  the               prescribed authority in the prescribed manner-               (a)   a declaration duly filled and signed  by               the  registered dealer to whom the  goods  are               sold containing the prescribed particulars  in               a prescribed form obtained from the prescribed               authority; or               (b)   if the goods are sold to the Government,               not  being a registered dealer, a  certificate               in the prescribed form duly filled and  signed               by   a   duly  authorised   officer   of   the               Government."               Section 13 states :               "   (1)   The  Central  Government   may,   by               notification  in  the Official  Gazette,  make               rules providing for-               (a)   the  manner  in which  applications  for               registration  may be made under this Act,  the               particulars  to  be  contained  therein,   the               procedure for the grant of such  registration,               the circumstances in which registration may be               refused and the form in. which the certificate               of registration may be given;               (b)   the  period of turnover, the  manner  in               which the turnover in relation to the sale  of               any goods under this Act shall be  determined,               and  the deductions which may be made  in  the               process of such determination;               (c)   the  cases and circumstances  in  which,               and  the  conditions  subject  to  which,  any               registration  granted  under this Act  may  be               cancelled;               (d)   the form in which and the particulars to               be contained in any declaration or certificate               to be given under this Act; (3)  The, State Government may make rules, not  inconsistent with  the  provisions of this Act and the rules  made  under sub-section (1), to carry out the purposes of this Act. (4)  In  particular  and ’Without prejudice  to  the  powers conferred by sub-section (3), the State Government may  make rules for all or any of the following purposes, namely               (e)   the authority from whom, the  conditions               subject  to  which  and the  fees  subject  to

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             payment  of  which  any  form   of-declaration               prescribed under sub-section (4) of section  8               may be obtained, the manner in which the form,               shall be kept in custody and records  relating               thereto  maintained, the manner in  which  any               such form may be used and any such declaration               may be furnished;               (f)   in  the  case  of  an  undivided   Hindu               family,  association, club, society,  firm  or               company or in the case of a person who carries               on  business  as  a  guardian  or  trustee  or               otherwise  on  behalf of another  person,  the               furnishing  of a declaration stating the  name               of  the person who shall be, deemed to be  the               manager  in  relation to the business  of  the               dealer in the State and the form in which such               declaration may be given;               (g)   the  time  within which, the  manner  in               which  and the authorities to whom any  change               in  the  ownership of any business or  in  the               name, place or nature of any business  carried               on by any dealer shall be furnished." Rule 6 of the Central Sales Tax (Kerala) Rules, 1967 read as follows :               "6. (1) Every dealer registered under  section               7  of the Act and every dealer liable  to  pay               under the Act shall submit a return of all his               transaction  including those in the course  of               export  of the goods out of the  territory  of               India  in  Form  11  together  with  connected               decla-               5 2 2               ration  forms  so as to  reach  the  assessing                             authority  on or before the 20th of ea ch  month               showing  the turnover for the preceding  month               and the amount or amounts collected by way  of               tax together with proof for the payment of tax               due thereon under the Act.               Provided  that in cases of delayed receipt  of               declaration  forms, the dealer may submit  the               declaration  forms  at  any  time  before  the               assessment is made :               Provided further that the delay in  submitting               the  declaration forms shall not exceed  three               months from the date of sale in question :               Provided  also  that  all  declaration   forms               pending  submission  by  dealers  on  2-5-1960               shall be submitted not later than 16-2-1961." The  first  proviso to Rule 6 was inserted  by  notification dated  January  3, 1958, the second  by  notification  dated April  26, 1960 and the third by notification dated  January 16, 1961. It  was  contended  on behalf of  the  appellants  that  the assessee  had not filed the declarations in form ’C’  before February  16,  1961 according to the third proviso  to  Rule 6(1) and in view of the breach of this Rule the assessee was not  entitled  to  take  advantage  of  the  lower  rate  of assessment  under  s. 8(1) of the Act.  The  opposite  view- point  was put forward on behalf of the assessee and it  was argued that the third proviso to Rule 6 (1) was ultra  vires of  s. 8 (4) read with s. 1 3 (4) (e) of the Act.   The  de- cision  of  the question at issue therefore depends  on  the construction of the phrase "in the prescribed manner" in  s. 8  (4)  read  with s. 13 of the Act.  In  our  opinion,  the

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phrase  "in the prescribed manner" occurring in s.  8(4)  of the  Act only confers power on the rule-making authority  to prescribe  a  rule  stating  what  particulars  are  to   be mentioned  in the prescribed form, the nature and  value  of the  goods sold, the parties to whom they are sold,  and  to which authority the form is to be furnished.  But the phrase "in  the prescribed manner" in s. 8(4) does not take in  the time  element.   In  other  words,  the  section  does   not authorise  the  rule making authority to prescribe  a  time- limit  within  which the declaration is to be filed  by  the registered dealer.  The view that we have taken is supported by  the  language of s. 13 (4) (g) of the Act  which  states that  the  State  Government may make rules  for  "the  time within  which,  the manner in which and the  authorities  to whom  any change in the ownership of any business or in  the name,  place  or nature of any business carried  on  by  any dealer  shall  be furnished." This makes it clear  that  the Legislature  was conscious of the fact that  the  expression "in  the manner" would denote only the mode in which an  act was to be done, and if any 523 time-limit was to be prescribed. for the doing of the,  act, specific  words  such as "the time within which"  were  also necessary  to be-put in the statute.  In  Stroud’s  Judicial Dictionary  it  is said that. the words  "manner  and  form" refer  only "to the mode in which the thing is to  be  done, and do not introduce anything from the Act referred to as to the thing which is to be done or the time for doing it".  In Acraman  v.  Herniman(1)  the  plaintiffs  had  become   the assignees  in bankruptcy proceedings against Garret who  had executed  on  March  4, 1850 a warrant of  attorney  to  the defendant Herninian on the strength of which the latter  had obtained judgment against him and sold his goods.  A copy of the warrant of attorney was filed with the officer acting as clerk of the docquets and judgments in the court of  Queen’s Bench  on March 1 1, 1850, but no affidavit of the  time  of execution of such warrant of attorney was filed at any time. Stat.  12  and  13 Viet. c. 106. s. 136  provided  that  any warrant of attorney given by a trader to confess judgment in a  personal action, not filed within twenty one  days  after execution in the manner and form provided by State. 3.  G.4. c.39 should be deemed fraudulent, null and void.  Section  1 of Stat. 3 G.4. c.39 required that such warrant of  attorney should  be filed together with an affidavit of the  time  of execution  thereof, within twenty-one days of the  execution of  the  warrant of attorney.  Section 2 provided  that  if, after  twenty-one  days, the party giving  such  warrant  of attorney  shall  be declared a bankrupt,  then,  unless  the warrant  or  a  copy  thereof  shall  have)  been  filed  as aforesaid  within  21  days from  the  execution  or  unless judgment shall have been signed or execution issued  thereon within  the same, period, such warrant of attorney  and  the judgment  and execution thereon, shall be deemed  fraudulent and void against the assignees.  As already stated, judgment had  been signed on March 11, 1850, i.e., within  twenty-one days of the execution of the warrant of attorney, and it was contended  on behalf of the defendant that the judgment  was valid  notwithstanding the failure to file the affidavit  as required by section 1 of Stat. 3 G.4. c.39. The argument was rejected  and  it  was held by the Queen’s  Bench  that  the warrant  of attorney and the judgment thereon were  void  as against  the assignees in bankruptcy.  In the course of  his judgment, Lord Camp bell C.   J. observed as follows :               "The  enactment  of  stat. 12 &  13  Viet.  c.               106,s.     136,  is very plain; and  I  cannot

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             agree to put a forced               construction  upon  it.  The  Legislature  has               said there that any warrant of attorney  given               by a trader to confess judgment in a  personal               action, not filed within twenty one days after               execution in manner and form provided by stat.               3  G.  4. c. 39, shall be  deemed  fraudulent,               null  and void.  The manner directed  by  that               Act is, filing               (1)   117 E. R. 1164.               :524               the warrant or copy, with an affidavit of  the                             time  of  execution.  Here are a  judg ment  and               execution on a warrant of attorney given by  a               trader, and the warrant filed, but without  an               affidavit.  The plain meaning of the late  Act               is that such a warrant shall be null and  void               ,against the assignees.  The words ’in  manner               and  form refer only to the mode in which  the               thing  is  to, be done, and do  not  introduce               anything  from the Act referred to, as to  the               thing  which  is to be done or  the  time  for               doing it." The view that we have, expressed as to the interpretation of s.  8 (4) of the Act is also supported by the ’Note’ to  the form  of  declaration-Form C-prescribed by Rule  12  of  the Central  Sales  Tax (Registration & Turnover)  Rules,  1957. The  Note  states that the form is ’to be furnished  to  the prescribed  authority ,in accordance with the  rules  framed under   section  13  (4)  (e)  by  the   appropriate   State Government’. For the reasons expressed, we hold that the third proviso to Rule 6 (1 ) is ultra vires of s. 8 (4) read with s. 1 3 (3 ) and (4) of the Act.  It follows therefore that the  assessee was  not  bound to furnish declarations in Form  ’C’  before February  16, 1961 in the present case.  In the  absence  of any  such  time-limit  it was the duty of  the  assessee  to furnish the declarations in form C within a reasonable time, and in the present case it is the admitted position that the assessee  did  furnish  the declarations on  March  8,  1961 before  the  order of assessment was made by the  Sales  Tax Officer.   We  are  accordingly  of  the  opinion  that  the assessee  has  furnished the declarations in Form C  in  the present case within a ,reasonable time and there has been  a compliance with the requirements of s. 8 (4) (a) of the Act. It  follows  that the High Court was right in  quashing  the order  of  assessment  made by the  Sales  Tax  Officer  and directing  him  to make a fresh order  of  assessment  after taking into consideration the declaration forms furnished by the assessee on March 8, 1961. We  accordingly dismiss this appeal, but as  the  respondent has not appeared there will be no order as to costs. Y.P.                                       Appeal dismissed.