http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 5  

PETITIONER: M/S. BALLABHDAS AGARWAL

       Vs.

RESPONDENT: THE STATE OF BIHAR

DATE OF JUDGMENT: 02/02/1962

BENCH: KAPUR, J.L. BENCH: KAPUR, J.L. HIDAYATULLAH, M. DAYAL, RAGHUBAR

CITATION:  1966 AIR  814            1966 SCR  Supl. (2) 967

ACT:      Sales  Tax-Appeal  from  order  of  Board  of Revenue-No  Appeal   from  order  of  High  Court- Assessee  if   can  agitate   the  correctness  of decision of  Board by special Leave-Remedy open to assessee when  question asked  for, not replied by the Board  to High  court-Appeal not  maintainable where  breach   of  Rule  of  natural  Justice  or violation of  principle  of  law  not  shown-Bihar sales Tax  Act,  1947  (Bihar  19  of  1947),  ss. 6,24,25,28.

HEADNOTE:      The appellant,  a Railway  contractor, having Refreshment  Rooms   and  Tea  stalls  at  various stations, was  registered as  a dealer  under  the Bihar Sales  Tax Act  1947. He  being aggrieved by the assessment  for the  year 1950-51  made by the sales Tax  officer took  the usual  appeals to the Sales Tax  Authorities and  after the appeals were rejected he took a revision under s. 24 of the Act before  the  Board  of  Revenue  Bihar  which  was dismissed. He  then applied under s. 25 of the Act to refer  six questions  of law to the High Court. The Board  referred only  one question to the High Court. The High Court after reframing the question answered it  in the  negative against him. Against the order  of the  Board of  Revenue the appellant brought an  appeal by special leave to the Supreme Court but  he did  not appeal against the judgment and order of the High Court. 968 ^      Held, that  an assessee  is not  entitled  to agitate  the   correctness  or  otherwise  of  the decision given  by the  Tribunal in  regard to the questions which  were  agitated  before  the  High Court and  were decided  against him  and  against which no appeal was brought to the Supreme Court.      Held, further,  that if any question on which the assessee  wanted a reference to the High Court

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 5  

was not  referred, it  was open to the assessee to apply to  the High  Court for a reference under s. 28 of the Bihar Sales Tax Act, 1947.      Held, also,  that it  has not been shown that there was  any such breach of the rules of natural justice or violation of any principle of law which would be a good ground for our interference direct with the  orders of  the Board  of Revenue  in  an appeal under Art. 136 of the Constitution.      Chimmonlal Rameshwarlal  v.  Commissioner  of Income Tax  (central), calcutta  A.I.R. 1960  S.C. 280 and  Chandi Prasad Chokhani v. State of Bihar, A.I.R. 1961 S.C. 1708, applied.

JUDGMENT:      CIVIL APPELLATE  JURISDISTION:  Civil  Appeal No. 379 of 1961.      Appeal by  special leave  from the Resolution dated April  21, 1954,  of the  Board of  Revenue, Bihar Patna in Revision Case No. 706 of 1953.      S.K. Kapur and K.K. Jain, for the appellants.      D.P. Singh,  R. K.  Garg, M.K. Ramamurthi and S.C. Agarwal, for the respondents.      1962. February,  2.-The Judgment of the Court was delivered by      KAPUR,  J.-This   appeal  by   Special  Leave against the  order of the Board of Revenue, Bihar, relates to  the assessment for the year 1950-51 of Sale Tax  of the  appellant under  the Bihar Sales Tax Act, 1947 (Act 19 of 1947), hereinafter called the ‘Act’.      The appellant  was a railway caterer, who had Refreshment  Rooms   and  Tea  Stalls  at  various Railway  Stations.   He  sold   various  kinds  of eatables, cigarettes, betels, milk, fruits and tea at railway stations. He was registered as a dealer under the  Act and  had been  carrying on business for a  fairly long  time. His  case was that as it was difficult  for him  to  maintain  accounts  in regard to eatables, 969 some of which were taxable and others were not, he made  representation   in  1944   to   the   Bihar Government  for   some  arrangement  so  that  the difficulty in  keeping different  sets of  account would  be   the  obviated.  As  a  result  of  his representation the  Bihar Government  by a  letter June 5,  1915, agreed that the appellant’s taxable turnover in  Bihar would be taken to be 66 2/3% of the, gross  turnover  during  the  quarter  ending December 31,  1944, and that this percentage might be revised after December 31, 1945. As a result of this letter,  the appellant  did not keep separate accounts for taxable and non-taxable items and for some of the quarters subsequent to those mentioned in the  letter above  referred to  were also taxed according to  the arrangements  contained in  that letter. For the period April 1, 1950, to March 31, 1951, the  gross turnover  was Rs.  11,16,270-11-0 and the  appellant claimed  that he be assessed at 66 2/3 % of that amount; but the Sales Tax officer taxed him  on the  total gross turnover except for the usual  rebate of  4% allowed in such cases. He

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 5  

submitted  that   in  this   turnover  there  were included tax-free  articles such  as fresh  milks, meat, fish,  green  vegetables  etc.,  which  were exempt from  Sales tax  under s. 6 of the Act. His submission was that the excess amount assessed was Rs. 11,416-15-0.  Against this  order he  took the usual appeals  to the  Sales Tax  Authorities  and after  the   appeals  were  rejected,  he  took  a revision under  s. 24  of the Act before the Board of Revenue, Bihar, where also he was unsuccessful. Under s. 25 of the Act, he applied for referring 6 questions of  law to  the  High  court  and  those questions were as follows:-      (i)  Whether upon  the true  construction  of           the agreement  of 1945 between the State           Government and  the assessee  which  had           been acted  upon and  not reviewed,  the           Department was  legally entitled to tax;           petitioner on his gross 970           turnover instead of 66 2/3 % of the same ?      (ii) Whether Member, Board of Revenue, having           held  that  "in  the  circumstances  the           petitioner had  prima  facie  bona  fide           grounds  for   his   belief   that   the           arrangement  which  the  Department  had           entered  into,   would  continue"  could           legally hold,  that the  petitioner  was           not entitled  to be assessed in terms of           the said arrangement ?      (iii)Whether in  the facts  and circumstances           of  the   case,  it   is  open   to  the           Department to  challenge the continuance           of the  arrangement arrived  at  between           the State  Government and the petitioner           especially so  when the State Government           by its  own acts or omissions misled the           petitioner into maintaining his accounts           in   a   manner   prejudicial   to   the           petitioner’s  claim  for  deductions  on           account of sale of tax free goods during           the period ?      (iv) Whether in  the facts  and circumstances           of the case, the petitioner was entitled           to the  entire deduction  on account  of           sale  of  meat  and  fish  in  terms  of           Notification No.  5564 Ft. dated 30-3-49           under section  6 of the Bihar Sales Act.           1947 ?      (v)  Whether  the  Member  Board  of  Revenue           having held that meat and fish mentioned           in Notification  No. 5564 Ft;. dated 30-           3-49 under  section 6 of the Bihar Sales           Tax, Act. 1947, included boiled meat and           fish  and  cold  meat  and  fish,  could           legally hold  that meat  and fish cooked           otherwise were  not covered in the terms           of said notification ? 971      (vi) Whether in terms of the Notification No.           5564 Ft.  dated 30-3-49  cold  meat  and           fish and  boiled meat  and fish could be           distinguished from  other preparation of           meat and fish ?

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 5  

But the  Board of  Revenue referred  the following question to the High Court under s. 6:-           "Whether the following forms of meat and      fish are covered by Notification No. 5564 Ft.      dated 30-3-49,  issued under section 6 of the      Bihar Sales Tax Act, 1947 ?      (i)  Raw (i.e.  uncooked in  any way) meat or fish.      (ii)  Boiled   meat  and   fish,  cooled   or           uncooled, meant  for sale or consumption           outside the petitioner’s premises.      (iii)Fish or  meat, which  has been boiled or           cooked  in  some  other  way  served  as           separate or  part of  a dish outside the           petitioner’s premises as separate dishes           or part of a menu.      (iv) Fish  or meat,  which has been boiled or           cooked in  some  other  way,  served  as           separate  dishes   or  part  of  a  dish           outside the petitioner’s premises." The High court reframed the question as follows:-           "Whether the  petitioner was entitled to      exemption under  Notification No.  5564  Ft.,      dated 30th  March, 1949, issued under section      6 of the Bihar Sales Act, 1947 with regard to      the sales  of the  preparations of  meat  and      fish e.g.,  meat curry  and fish curry served      as separate  dishes, or  as part of the menu,      at  lunch  or  dinner,  at  the  petitioner’s      premises or outside ?" and answered  it  against  the  appellant.  It  is against the order of the Board of Revenue that the appellant has  come in appeal by special leave but has 972 not appeared against the judgment and order of the High Court.      This Court in M/s. Chimmonalall Rameshwarlall v. Commissioner  of Income-tax  (Central) Calcutta (1) held  that in  cases where a reference is made to the  High Court  and the appeal is brought only against the  order of  the  Income  Tax  Appellate Tribunal then the Supreme Court, if it interfered, would in fact be setting aside the judgment of the High Court  without there  being an appeal to this Court, and  that this  Court could  not bypass the normal procedure  which was  to be adopted for the purpose. In  a later  Judgment  in  Chandi  Prasad Chokhani v.  State of  Bihar (2)a similar view was taken  that  as  the  assessee  had  not  obtained Special Leave  in respect  of any  of  the  orders passed by  the High Court under s. 25 those orders became final  and binding  and the  assessee could not be  allowed to  bypass or go behind the orders of the  High Court  and  such  exercise  would  be particularly  inadvisable  in  a  case  where  the result may  be a  conflict of  the decision of two courts  of   competent  jurisdiction,   which  was contrary to the object of ss. 23, 24 and 25 of the Act. In  this view of the law the appellant is not entitled to  agitate the  correctness or otherwise of the decision given by the Tribunal in regard to the questions  which we  agitated before  the High Court and  were decided  against the appellant and against which no appeal has been brought.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 5  

    But he  submits that  there are  three  other questions which  also  arise,  and  on  which  the appellant wanted a reference to the High Court but which were  not   referred. It  was  open  to  the appellant  to  apply  to  the  High  Court  for  a reference under  s. 25. That the appellant did not do, and  it has  not been shown that there was any such breach 973 of the  rules of  natural justice  or violation of any principal  of law which would be a good ground for our interference direct with the orders of the Board of  Revenue in  an appeal  under Art. 136 of the Constitution.      In our  opinion the  appeal is  without force and is dismissed with costs.                                  Appeal dismissed.