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the respondent-M/s Shivam Coke Industries, Dhanbad is a manufacturer of coal and was registered under the provisions of the Bihar Finance Act, 1981 [now repealed – for short “BFT Act, 1981”] and presently under the provisions of Jharkhand Value Added Tax, 2005. Respondent-assessee being manufacturers of hard coke buys coal from Bharat Coking Coal Ltd. after making the payment of local Sales Tax @ 4% which is being used as an input for the purpose of manufacturing the hard coke. Respondent was assessed to tax for the Financial Years 1988-89, 1992-93 and 1996-97 determining the tax on intra-State sales transactions as well as Central Sales Tax on inter-State sales transactions. Respondent preferred an Appeal before the Joint Commissioner of Commercial Taxes (Appeals), Dhanbad Division, Dhanbad against the assessment orders passed between 26.4.1990 to 23.12.1998 for the Financial Years 1988-89, 1992-93 and 1996-97, who vide order dated 25.08.2003 remanded the aforesaid assessment proceedings by a common order to re-examine the books of account and to re-determine the nature of sales as to whether they are intra-state sales or inter-state sales, on the basis of the books of account and the audit reports as well as on the basis and within the meaning and scope of Section 3(a) of the Central Sales Tax Act, 1956 (for short “the CST Act”).

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                                                                  REPORTABLE

                          IN THE SUPREME COURT OF INDIA

                           CIVIL APPELLATE JURISDICTION

                    CIVIL APPEAL NOS.  6889-6891 OF 2011

                [Arising out of SLP (C) Nos. 19104-19106 of 2008]

State of Jharkhand & Ors. Etc.                          .... Appellants

                                      Versus

M/s. Shivam Coke Industries, Dhanbad, Etc.               .... Respondents

                                       With

                           CIVIL APPEAL NO. 6892 OF 2011

                    [Arising out of SLP (C) No. 21491 of 2008]

                                       With

                           CIVIL APPEAL NO. 6893 OF 2011

                     [Arising out of SLP (C) No. 8424 of 2010]

                                    JUDGMENT

Dr. MUKUNDAKAM SHARMA, J.

1.    Delay condoned in SLP (C) No. 8424 of 2010.

2.      Leave granted.

By   this   common   judgment   and   order,   we   propose   to   dispose   of   these 

appeals   as   they   involve   similar   issues   both   of   facts   as   also   of   law   and 

therefore, they were heard together.

3.    Appeals   arising   out   of  SLP   (Civil)   Nos.   19104-19106   of   2008   are 

directed   against   the   judgment   and   order   dated   14.3.2008   in   WP   (T)   No. 

6377 of 2007, WP (T) No. 5895 of 2007 and WP (T) No. 5892 of 2007. The 

appeal arising out of SLP (Civil) No. 21491 of 2008 is directed against the 

judgment and order dated 19.3.2008 in WP (T) No. 6071 of 2007 and the 

appeal arising out of SLP (Civil) No. 8424 of 2010 is directed against the 

judgment and order dated 31.7.2009 in W.P. (T) 54 of 2009 passed by the 

High Court of Jharkhand at Ranchi allowing all the Writ Petitions filed by 

the respondents herein.

CIVIL APPEAL ARISING OUT OF SLP (C) NO. 19104 OF 2008

4.    The facts leading to the filing of the case in the appeal arising out of 

SLP   (C)   No.   19104   of   2008   are   that   the   respondent-M/s   Shivam   Coke 

Industries, Dhanbad is a manufacturer of coal and was registered under 

the   provisions   of   the   Bihar   Finance Act,   1981   [now   repealed   -   for   short 

"BFT Act, 1981"] and presently under the provisions of Jharkhand Value 

Added Tax, 2005. Respondent-assessee being manufacturers of hard coke 

buys coal from Bharat Coking Coal Ltd. after making the payment of local 

Sales Tax   @   4%   which   is   being   used   as   an   input   for   the   purpose   of 

manufacturing   the   hard   coke.    Respondent   was   assessed   to   tax   for   the 

Financial   Years   1988-89,   1992-93   and   1996-97   determining   the   tax   on 

intra-State sales transactions as well as Central Sales Tax on inter-State 

sales   transactions.   Respondent   preferred   an   Appeal   before   the   Joint 

Commissioner   of   Commercial   Taxes   (Appeals),   Dhanbad   Division, 

Dhanbad   against   the   assessment   orders   passed   between   26.4.1990   to 

23.12.1998 for the Financial  Years 1988-89, 1992-93 and 1996-97, who 

vide   order   dated   25.08.2003   remanded   the   aforesaid   assessment 

proceedings by a common order to re-examine the books of account and 

to re-determine the nature of sales as to whether they are intra-state sales 

or   inter-state   sales,   on   the   basis   of   the   books   of   account   and   the   audit 

reports   as   well   as   on   the   basis   and   within   the   meaning   and   scope   of 

Section 3(a) of the Central Sales Tax Act, 1956 (for short "the CST Act"). 

Thereafter,   Deputy   Commissioner   of   Commercial   Taxes,   Dhanbad   Circle 

on   the   basis   of   guidelines   issued   by   the   Joint   Commissioner   of 

Commercial   Taxes   (Appeals)   passed   the   revised   assessment   orders   on 

26.12.2003 reversing the then inter-State sales under Section 3(a) of the 

CST  Act  1956  into  the  intra-State  sales.     Respondent   on  10.3.2005  filed 

an application for refund of excess amount of tax after adjustment of the 

amount to be paid by Respondent. Accordingly, on 21.8.2006 notice was 

issued   by   Deputy   Commissioner   of   Commercial   Taxes   to   Respondent   to 

file   its   refund   application   before   the   Joint   Commissioner   of   Commercial 

Taxes   since   the   amount   refundable   to   the   Respondent   is   above   Rs. 

25,000/-.     Thereafter   in   the   year   2006,   as   is   alleged  by   the   respondent, 

the Deputy Commissioner of the Dhanbad Circle got changed and the new 

Deputy   Commissioner   examined   the   revised   assessment   orders   of   the 

Respondent   and   he   opined   that   the   revised   assessment   orders   do   not 

conform to the appellate direction and Deputy Commissioner informed the 

Joint   Commissioner   of   Commercial   Taxes   (Administration)   about   his 

observations.   The   Joint   Commissioner   of   Commercial   Taxes 

(Administration),   Dhanbad   Division,   Dhanbad   [Appellant   No.   4]   then 

initiated   the   proceeding  suo   motu  under   Section   46(4)   of   the   adopted 

Bihar Finance Act, 1981 [now repealed] and issued notice/Memo No. 744 

dated   1.8.2007   directing   the   Respondent   to   furnish   the   complete   sets  of 

books   of   account   in   order   to   determine   the   legality   and   propriety   of   the 

said   revised   assessment   orders   conforming   to   the   appellate   order.   On 

28.11.2007   Respondent   filed   Writ   Petition   before   the   High   Court   of 

Jharkhand which was registered as WP (T) No. 6377 of 2007 praying for a 

direction to quash the notice/Memo No. 883 dated 20.9.2007 [which was 

issued   in   pursuance   to   earlier   notice/Memo   No.   744   dated   1.8.2007] 

issued   by   the   Joint   Commissioner   of   Commercial   Taxes   (Administration) 

for initiating the proceeding  suo motu  under Section 46(4) of the repealed 

BFT Act, 1981 and also for quashing the order dated 26.11.2007 passed 

by the Joint Commissioner of Commercial Taxes by which he set aside the 

revised assessment order dated 26.12.2003. The High Court of Jharkhand 

vide   its   order   dated   14.03.2008   allowed   the   Writ   Petitions   of   the 

respondent   herein   against   which   the   appellants   have   filed   the   present 

appeals on which we heard the learned counsel appearing for the parties.

CIVIL APPEALS ARISING OUT OF SLP (C) NOS. 19105-06 OF 2008

5.    The  facts  leading to the filing of appeals arising out of SLP (C) Nos. 

19105-06   of   2008   are   that   the   Respondent   -M/s.   Rani   Sati   Coke 

Manufacturing Company, Baliyapur, Dhanbad is engaged in processing of 

coal to coke and was assessed to tax for the Financial Years from 1984-85 

to  2000-2001  determining the tax  on "intra-State sales"  transactions,  as 

well   as   Central   Sales   Tax   on   inter-State   sales   transactions.   Respondent 

filed an appeal against the assessment orders passed between 29.12.1987 

to   10.3.2003   for   the   Financial   Years   from   1984-85   to   2000-01   and   the 

appellate   authority,   i.e.,   the   Joint   Commissioner   of   Commercial   Taxes 

(Appeal), Dhanbad Division, Dhanbad remanded the aforesaid assessment 

proceedings   by   a   common   order   to   re-examine   the   nature   of   intra-State 

sales and inter-State sales on the basis of the books  of account and the 

audit reports as well as on the basis of the meaning and scope of Section 

3(a)   of   the   CST   Act,   1956.   Thereafter,   the   Deputy   Commissioner   of 

Commercial Taxes  passed the revised assessment order vide orders dated 

14.12.2005   and   29.12.2005   reversing   /   converting   the   then   inter-State 

sales  under  Section  3(a)  of  the  CST   Act,  1956   into the   intra-State   sales. 

Pursuant   thereto,   Respondent   filed   prescribed   refund   application   before 

the   Deputy   Commissioner   of   Commercial   Taxes.   Thereafter   in   the   year 

2006, it is alleged by the respondents that, the Deputy Commissioner  of 

the   Dhanbad   Circle   got   changed   and   the   new   Deputy   Commissioner 

examined the revised assessment orders of the Respondent and he opined 

that   the   revised   assessment   orders   do   not   conform   to   the   appellate 

direction and as such do not have any merit as they were re-assessed on 

the basis  of same facts  for  converting  the then  inter-State  sales into  the 

intra-State   sales,   which   resulted   the   claim   of   refund   and   Deputy 

Commissioner   informed   the   Joint   Commissioner   of   Commercial   Taxes 

(Administration)   about   his   observations.   Pursuant   to   this   Joint 

Commissioner   of   Commercial   Taxes   (Administration)   initiated   the 

proceeding  suo motu  under Section 46(4) of the Bihar Finance Act, 1981 

and   issued   notice   No.   850   dated   06.09.2007   directing   Respondent   to 

furnish the complete sets of  books of  account,  in order to  determine the 

legality and propriety of the said revised assessment orders conforming to 

the appellate order. Thereafter, Respondent No. 2 filed two Writ Petitions 

before the High Court of Jharkhand which were registered as W.P. (T) Nos. 

5892   and   5895   of   2007   praying   for   the   direction   to   the   appellants   for 

immediate   refund   of   the   entire   amount   arising   out   of   the   revised 

assessment   orders   in   which   High   Court   directed   the   appellants   to 

participate   in   revision   proceedings,   after   which   Respondent   filed   an 

amended   petition   before   the   High   Court   by   bringing   the   fact   that   the 

revision  proceedings  under   Section   46(4)  of the  Bihar  Finance   Act,  1981 

was   opened   on   the   basis   of   an   application   of   the   Deputy   Commissioner 

which is not permitted as per the provisions of the repealed BFT Act, 1981 

and   that   the   same   is   also   barred   by   limitation.   The   High   Court   of 

Jharkhand   vide   its   order   dated  14.03.2008   allowed   the   Writ   Petitions   of 

the   respondents   herein   against   which   the   appellants   have   filed   the 

present appeals on which we heard the learned counsel appearing for the 

parties. 

CIVIL   APPEALS   ARISING   OUT   OF   SLP   (C)   NO.   21491   AND   8424   OF 

2008

6.    The appeals arising out of SLP(C) No. 21491 of 2008 are against the 

judgment   and   order   of   the   High   Court   of   Jharkhand   dated   19.03.2008 

following   the   judgment   in   WP   (T)   NO.   6377   of   2007.       The   facts   of   this 

appeal and also of the appeal arising out of SLP (C) No. 8424 of 2010 are 

similar to the other appeals at hand. So, we need not go into the detailed 

facts of the said two appeals.

7.    The   learned   counsel   appearing   for   the   appellant   while   taking   us   to 

the   impugned   judgment   and   also   the   connected   records   submitted   that 

judgment   and   order   passed   by   the   High   Court   is   incorrect.   He   further 

submitted   that   the   findings   arrived   at   by   the   High   Court   are   erroneous 

and based on wrong readings of the materials available on record.

8.    The   learned   counsel   appearing   for   the   respondents   on   the   other 

hand   while   drawing   support   from   the   impugned   judgment   and   order 

submitted that the findings recorded by the High Court are findings of fact 

and   therefore   this   Court   should   not   interfere   with   the   aforesaid 

conclusions of fact arrived at by the High Court by giving cogent reasons 

for its conclusions.

9.       Upon reading the entire records and materials placed and also upon 

hearing   the  learned   counsel   appearing  for   the   parties,   in  our  considered 

opinion three following issues appear to arise for our consideration;

      a) Whether   the  suo motu power  of revision under  Section  46(4)  of the 

         BFT Act, 1981, vested with the Joint Commissioner was legally and 

         properly exercised in the present case;

      b) Whether   or   not   the   action   taken   by   the   Department   was  barred   by 

         limitation   and   whether   such   action   was   bad   for   not   having   been 

         initiated within a reasonable time;

      c) Whether   the   order   dated   26.11.2007   passed   by   the   Joint 

         Commissioner   setting   aside   the   revised   assessment   order   dated 

         26.12.2003 is proper and could be maintained;

10.      We propose to deal with the aforesaid three issues one after the other 

and record our reasons for coming to the decision in each of the aforesaid 

issues;

Issue 1: Whether exercise of Suo Motu power of revision as provided 

under Section 46(4) of the BFT Act, 1981 could be upheld;

11.    Section 46 of the BFT Act, 1981 with which we are concerned in the 

present   case   came   to   the   statute   book   with   the   enactment   of   Bihar 

Finance   Act,   1981.   The   aforesaid   Act   was   a   consolidated   Act   which   was 

passed by the State Legislature amending the law relating to levy of tax on 

sale and purchase of goods.   In the said Act, Section 45 provides for the 

provision of filing an appeal whereas Section 46 of the Act lays down the 

provision of revision.  In the present case, we are only concerned with the 

provision of revision and in our estimation, the entire provision of Section 

46 should be extracted hereinafter.

       46.   Revision  - (1)   Subject to such rules as may be made by 

       the State Government an order passed on an appeal under sub-

       section   (1)   or  (2)   of   section   45  may,   on  application,   be   revised 

       by the Tribunal.

       (2)     Subject   as   aforesaid   any   order   passed   under   this   part   or 

       the rules made thereunder, other than an order passed by the 

       Commissioner   under   sub-section   (5)   of   section   9   or   an   order 

       against which an appeal has been provided in section 45 may, 

       on application be revised.

            (a)   by the Joint Commissioner,  if  the said  order  has been 

            passed   by   an   authority   not   above   the   rank   of   Deputy 

            Commissioner; and

            (b)     by the Tribunal, if the said order has been passed by 

            the Joint Commissioner or Commissioner.

       (3)     Every   application   for   revision   under   this   section   shall   be 

       filed   within   ninety   days   of   the   communication   of   the   order 

       which is sought to be revised, but where the authority to whom 

       the application lies is satisfied that the applicant had sufficient 

       cause for not applying within time, it may condone the delay.

       (4)   The   Commissioner   may,   on   his   own   motion   call   for   an 

       examine the records of any proceeding in which any order has 

       been passed by any other authority appointed under section 9, 

       for   the   purpose   of   satisfying   himself   as   to   the   legality   or 

       propriety   of   such   order   and   may,   after   examining   the   record 

       and   making   or   causing   to   be   made   such   enquiry   as   he   may 

       deem necessary, pass such order as he thinks proper.

       (5)   No order under this section shall be passed without giving 

       the appellant as also the authority whose order is sought to be 

       revised   or   their   representative,   a   reasonable   opportunity   of 

       being heard.

       (6)     Any   revision   against   an   appellate   order   filed   and   pending 

       before  the  Joint  Commissioner   or a  revision  against  any  other 

       order filed and pending before the Deputy Commissioner since 

       before   the   enforcement   of   this   part   shall   be   deemed   to   have 

       been   filed   and/or   transferred   respectively   to   the   Tribunal   and 

       Joint Commissioner; and any revision relating to a period prior 

       to   the   enforcement   of   this   part   against   an   appellate   order,   or 

       against   any   other   order   passed   by   an   authority   not   above   the 

       rank   of   Deputy   Commissioner   shall,   after   the   enforcement   of 

       this part, be respectively filed before the Tribunal and the Joint 

       Commissioner.

12.    The said Act came to be amended in 1984.   Section 10 of the Bihar 

Finance   Amendment   Act,   1984   amended   Section   46   in   some   respect 

which again is extracted hereinbelow:-

        10.    Amendment of section  46 of the  Bihar  Act V, 1981 (Part  

               I).  -  In  sub-section  (3) of section 46  of the  said  Act  for 

               the word "sixty" the word "ninety" shall be substituted.

        (2)   For   sub-section   (4)   the   following   sub-section   shall   be 

          substituted namely :-

        "4 (a) The Commissioner may, on his own motion call for and 

          examine  the  records of any proceeding  in which  any order 

          has   been   passed   by   any   other   authority   appointed   under 

          section   9,   for   the   purpose   of   satisfying   himself   as   to   the 

          legality or property of such order and may, after examining 

          the record and making or causing to be made such enquiry 

          as   he   may   deem   necessary,   pass   such   order   as   he   thinks 

          proper.

13.    By   inserting   a   provision   namely   Section   7   of   the   Bihar   Finance 

(Amendment)   Ordinance,   1989,   clause   (b)   of   sub-Section   (4)   has   been 

deleted with effect from May, 1989. Therefore, the statutory provision that 

now stands and is operative is that Section 46 provides for a revision of all 

appellate   and   other   orders   passed   by   various   authorities   under   the   BFT 

Act,   1981.     According   to   the   statutory   provision   as   applicable,   power   of 

revision   is   vested   with   the   Tribunal   and   the   Joint   Commissioner,   which 

power   is   to   be   exercised   on   application   by   any   person   aggrieved,   but 

subject   to   time   limit   prescribed   in   sub-Section   (3)   i.e.   90   days   of   the 

communication of the order with a further power to condone the delay, if 

sufficient   cause   is   shown.       There   is   an   additional   power   vested   on   the 

Commissioner   which   empowers   the   Commissioner   to   initiate   suo   motu 

revision   proceedings   at   any   time   and   for   exercising   such   power   no 

limitation   has   been   prescribed   in   the   statute.     The   power   of   the 

Commissioner   to   initiate   such   suo   motu   revisional   proceeding   has   been 

delegated   to   the   Joint   Commissioner   of   Commercial   Taxes 

(Administration)   against   the   orders   of   the   officers   lower   than   his   rank 

which   is   so   delegated   in   terms   of   the   notification   issued   by   the   State   of 

Bihar under S.O. No. 795 dated 28th June 1986.   

14.    It is thus established that under Section 46 of the BFT Act, 1981, it 

is   the   Commissioner   who   on   the   basis   of   an   application   filed   by   an 

aggrieved   party   revise   the   order   passed   by   any   authority   subordinate   to 

him.   He also has the additional power alongwith the Joint Commissioner 

as   a   delegatee   as   provided   under   Section   46(4)   of   the   BFT   Act,   1981   to 

revise an order passed by an authority subordinate to it by exercising its 

suo motu power.

15.    In   all   these   appeals,   the   Joint   Commissioner   of   Commercial   Taxes 

has exercised the power vested on him under Section 46(4) of the BFT Act, 

1981   which   power   in   most   cases   concerning   the   present   appeals   was 

exercised   by  him within   a period  of  three   years  but in  some  other   cases 

beyond the expiry of three years period, but soon thereafter.

16.    In   that   view   of   the   matter,   counsel   appearing   for   the   respondent 

submitted   in   the   High   Court   that   exercise   of   such   power   by   the   Joint 

Commissioner after expiry of more than two years time is illegal, without 

jurisdiction   and   bad   in   law.   The   Division   Bench   of   the   Jharkhand   High 

Court found force in the aforesaid  submissions of the counsel appearing 

for   the   respondent   and   held   that   such   suo   motu   power   vested   on   an 

authority   must   be   exercised   within   three   years   period   which   is   a   period 

prescribed   under   Article   137   of   the   Limitation   Act,   1963.       According   to 

the   High   Court   where   no   time   limit   is   prescribed   for   filing   a   revision, 

Article 137 of the Limitation Act would apply to such cases.  It was further 

held   that   since   under   Section   46(4),   no   time   limit   is   prescribed   the 

limitation   as   prescribed   under   Article   137   of   the   Limitation   Act   would 

apply to the facts and circumstances of the present case.

17.    Counsel   appearing   for   the   appellant,   however,   submitted   before   us 

that   the   aforesaid   contentions   on   the   face   of   it   cannot   be   accepted   as   a 

correct  position in law for by enacting sub-Section  (4) in Section  46, the 

legislature thought it fit not to impose any restriction or time limit so far 

as   limitation   is   concerned   and   therefore   to   hold   that   Article   137   of   the 

Limitation Act would apply to such provisions is nothing but misreading 

of   the   provisions   for   if   that   was   the   intention   of   the   legislature   it   would 

have   so   stated   specifically   by   making   the   said   provision   applicable   to   a 

case like this.

18.    The counsel therefore, submitted that such power of initiation of suo 

motu revision proceedings by the Commissioner or Joint Commissioner as 

the case may be should be held to be without any time or such restriction 

or at least it should be held that such exercise of power of revision could 

be   exercised   suo   motu   within   a   reasonable   time   depending   on   the   facts 

and circumstances of each case.

19.    Another submission which is advanced by the counsel appearing for 

the respondent was that the Joint Commissioner has exercised the power 

of   suo   motu   revision   in   the   instant   case   on   the   basis   of   an   application 

filed   by   the   Deputy   Commissioner   which   was   sent   to   the   Joint 

Commissioner by him and that application was drawn up and submitted 

under Section 46(4) itself and therefore, the entire exercise of power by the 

Joint   Commissioner   is   fallacious,   untenable   and   should   be   held   to   be 

illegal.

20.    The   counsel   appearing   for   the   appellant,   however,   refuted   the   said 

allegations   and   submitted   that   although   Deputy   Commissioner   had 

written   a   letter   to   the   Joint   Commissioner   bringing   to   his   notice   some 

mistakes and errors apparent on the face of records and illegalities by his 

predecessor in his order, but, it was a power which was exercised by the 

Joint   Commissioner   independently   on   his   own   accord   and   therefore,   it 

cannot be said that the aforesaid power was exercised illegally or without 

jurisdiction.

21.    We may therefore, refer to the materials on record so as to record our 

findings on the aforesaid issue.   

22.    In   all   these   appeals,   there   are   letters   which   were   written   by   the 

Deputy   Commissioner   of   Commercial   Taxes   to   the   Joint   Commissioner 

(Administration).  One of such letter is dated 28.8.2007.  In the said letter 

it is stated by the Deputy Commissioner that the said communication is 

regarding filing of suo motu revision under Section 46(4) of the BFT Act, 

1981.     The   aforesaid   letter   by   the   Deputy   Commissioner,   Commercial 

Taxes   was   written   to   the   Joint   Commissioner   (Administration).       In   the 

said   letter,   the   Deputy   Commissioner   has   pointed   out   some   alleged 

mistakes in the original tax assessment order and the revised order.     He 

also   stated   in   that   communication   that   he   is   unable   to   agree   with   the 

revised   tax   assessment   order   and   reimbursement   order   passed   by   the 

Divisional   Incharge   and   therefore,   according   to   his   opinion   a   revision 

should   be   filed   under   Section   46(4)   of   the   BFT   Act,   1981   against   the 

revised tax assessment order dated 29.12.2005

23.    Our attention was also drawn to the notice for revision issued by the 

Joint   Commissioner   of   Commercial   Taxes   (Administration).     One   of   the 

notices   is   dated  17.12.2007  issued   to   M/s.   Shivam   Coke   Industries 

namely   the   respondent   herein   for   the   assessment   years   1988-1989   to 

1992-1993 and 1996-1997.   The said notice reads as follows:-

         "Whereas all the points and facts have not been considered 

         while   passing   the   revised   assessment   orders   pertaining   to 

         the   above   cases   which   were   to   be   considered   as   per 

         directions   of   the   appellate   court,   hence  the   related   revised 

         assessment   orders   are   not   in   conformity   neither   the 

         directions of the appellate court and the provisions of law.

         In the light of the above facts the legality & propriety of the 

         revised   assessment   orders   has   not   been   established   and 

         hence the revision of the said orders have been considered 

         necessary.

         You   are   hereby   directed   to   be   present   before   the 

         undersigned   on   15.5.2007   and   place   your   side   as   to   why 

         the above stated revised orders should not be set aside?

                 Joint Commissioner of Commercial Taxes (Adm.)

                 Dhanbad Division, Dhanbad"

24.    Such   orders   are   also   existing   against   similar   notices   in   the 

connected matters.

25.    Relying   on   the   aforesaid   two   documents,   the   counsel   for   the 

respondent   submitted   before   us   that   it   is   apparent   on   the   face   of   the 

record that the Joint Commissioner of Commercial Taxes initiated the suo 

motu   action   on   the   basis   of   the   letter   of   the   Deputy   Commissioner, 

Commercial Taxes who had stated that the revision should be filed under 

Section 46(4) of the BFT Act, 1981.   It was submitted in such a situation 

and that since it is an application filed by the Deputy Commissioner, the 

same   was   a   power   to   be   exercised   under   Section   46   (2)   of   the   BFT   Act, 

1981     which   is   an   ordinary   power   of   revision   to   be   exercised   by   the 

competent   authority   on   an   application   filed   by   the   aggrieved   party   and 

here   the   Deputy   Commissioner.     According   to   the   counsel,   since   the 

Deputy   Commissioner   is   an   aggrieved   party,   he   could   file   such   an 

application seeking for revision within a period prescribed i.e. 90 days and 

in   that   view   of   the   matter   even   if   the   Joint   Commissioner   exercises   suo 

motu power, such power could and should have been exercised within a 

period of 90 days as prescribed.

26.    We are, however, unable to accept the aforesaid contentions for the 

simple reason that  a bare perusal of the notice issued on 17.12.2007, the 

contents   of   which   have   been   extracted   hereinbefore   would   indicate   that 

the aforesaid notice was issued by the Joint Commissioner by exercising 

his individual suo motu power as provided under Section 46(4).   It is not 

a case where such notice was issued on the basis of an application filed 

by the Deputy Commissioner. This is obvious because in the said notice, 

there   is   absolutely   no   reference   made   of   the   application   sent   by   the 

Deputy Commissioner.   If from the available records of a particular case, 

the Joint Commissioner forms an independent opinion that the same is a 

case   where   suo   motu   power   of   Revision   should   be   exercised,   he   is 

empowered to so exercise such suo motu power of revising an order which 

appears to  be illegal  and without jurisdiction  to  the  competent  authority 

who   is   empowered   to   issue   such   notice   by   recording   his   reasons   for 

coming to such a conclusion in the notice itself.

27.    In the present case,  the  Joint  Commissioner has  exercised his own 

independent   mind   for   issuing   the   notice   and   also   recorded   his   own 

reasons   for   coming   to   a   conclusion   as   to   why   the   power   under   Section 

46(4)   should   be   exercised.       Having   recorded   the   aforesaid   reason,   such 

notice was issued to the assessee after forming a decision.   The assessee 

was informed by issuing the said notice that the legality and propriety of 

the   revised   assessment   order   has   not   been   established   because   of   the 

reasons   mentioned   in   the   notice   and   therefore,   the   revision   of   the   said 

orders   is   proposed   is   it   has   been   considered   necessary.         By   the   said 

notice,   the   assessee   was   directed   to   be   present   before   the   Joint 

Commissioner and place his side as to why the above revised assessment 

order should not be set aside.  

28.    The   respondent   being   aggrieved   by   the   issuance   of   the   aforesaid 

order   filed   a   writ   petition   before   the   High   Court.       The   High   Court, 

however, did not grant any stay of the aforesaid notice and permitted the 

respondent   to   contest   the   said   notice   in  accordance   with   law  during  the 

course   of   which   the   Joint   Commissioner   of   Commercial   Taxes   has   set 

aside the revised orders and sent back the matter for fresh assessment to 

the assessing officer.   

29.    The   aforesaid   subsequent   development   which   had   taken   place 

during the pendency  of the writ petition  in  the High  Court  has  not been 

addressed   to   and   decided   by   the   High   Court   as   the   High   Court   has 

disposed of the entire writ petition on two issues namely on the issue of 

the ambit and scope of Section 46(4) of the BFT Act, 1981 and also on the 

ground of limitation.

30.    The   Deputy   Commissioner,   Commercial   Taxes   Division   has   pointed 

out in his communication to the Joint Commissioner several loopholes in 

the   revised   assessment   orders   passed   by   the   assessing   officer.     The 

Deputy   Commissioner   has   also   pointed   out   how   the   assessee   has   made 

conflicting   claims   and   statements   and   also   how   while   upholding   such 

contradictory   claims,   there   has   been   a   revenue   loss   for   the   department. 

Alongwith his letter, some of the relevant records were transmitted to the 

Joint   Commissioner.       It   is   true   that   the   Deputy   Commissioner, 

Commercial Taxes Division has brought out and pointed out some of the 

illegalities   and   irregularities  committed   in   the   revised   assessment   orders 

passed   by   his   predecessor   in   the   assessment   orders   relating   to   the 

respondent.

31.    But the impugned notice issued by the Joint Commissioner  ex facie  

indicates   that   he   being   the   competent   authority   has   formed   an 

independent   opinion   and   personal   satisfaction   that   the   legality   and 

propriety   of   the   revised   assessment   orders   has   not   been   established 

because of the reasons specifically stated in the said notice and therefore 

he has thought it fit to exercise his power of suo motu revision consequent 

upon which the aforesaid notice was issued.

32.    There   is   no  reference   in   the   said   notice   to   the   letter   and   any   other 

materials contained with the letter of the Deputy Commissioner anywhere 

in   the   notice   and   therefore,   it   cannot   be   said   that   while   coming   to   the 

aforesaid   conclusion   in   the   impugned   notice,   the   Commissioner   was 

influenced   only   by   the   opinion   of   the   Deputy   Commissioner.       On 

consideration   of   the   records   we   are   satisfied   that   it   was   not   a   revision 

initiated on the basis of any application filed by an aggrieved party namely 

the Deputy Commissioner but initiation of a Revisional proceeding by the 

Joint   Commissioner   by   forming   his   own   opinion   and   satisfaction   to 

exercise suo motu power vested under Section 46(4) of the BFT Act on the 

basis   of  the   materials  on  record.       The   aforesaid  contention   is   therefore, 

rejected.

Issue   2   -   Whether   or   not   the   action   taken   by   the   Department   was 

barred by limitation 

33.    The next issue which now arises for our consideration is whether the 

aforesaid   exercise   of   power   of   drawing   up   a   revisional   proceeding   by 

exercising   suo   motu   power   was   not   exercised   within   the   period   of 

limitation or within a reasonable period of time.

34.    We have also extracted the provision which clearly indicates that no 

period   of   limitation   is   prescribed   for   initiation   of   suo   motu   revisional 

proceeding   by   the   Commissioner   or   the   Joint   Commissioner   as   the   case 

may   be,   whereas   a   period   of   limitation   is   prescribed   for   filing   a   revision 

application   by   an   aggrieved   party   for   initiation   of   the   revisional 

jurisdiction   of the  Commissioner  which  period  is  90  days,   as  is  stood  at 

that relevant time.

35.    The High Court has held that there cannot be an unlimited period of 

limitation even for exercising of suo motu revisional power for initiation of 

a proceeding by the Commissioner or the Joint Commissioner as the case 

may  be   and  therefore  provision  of  Article   137   of  the   Limitation   Act    was 

read into the Act laying down that at least within a period of three years 

from the date of accrual of the cause of action such a power of suo motu 

Revision should be exercised by the Joint Commissioner.   

36.    We   are   again   unable   to   accept   the   aforesaid   contention   as   the 

legislature has not stated in the provision at all regarding the applicability 

of Article 137 of the Limitation Act to Section 46(4) of the BFT Act.   If the 

legislature intended to provide for any period of limitation or intended to 

apply   the  said   provision   of   Article   137   into  Section   46(4),   the   legislature 

would have specifically said so in the Act itself.   When the language of the  

legislature is clear and unambiguous, nothing could be read or added to 

the   language,   which   is   not   stated   specifically.   Therefore,   the   High   Court 

wrongly   read   application   of   Section   137   of   the   Limitation   Act   to   Section 

46(4) of the BFT Act. 

37.    It   is   a   settled   position   of   law   that   while   interpreting   a   statute, 

nothing could be added or subtracted when the meaning of the section is 

clear   and   unambiguous.     In   this   connection   we   may   also   refer   to   the 

decision of this Court in Sakuru vs. Tanaji reported in (1985) 3 SCC 590 

wherein   it   was   stated   by   this   Court   that   the   Limitation   Act   applies   to 

courts and not to quasi judicial authority.  

38.    The aforesaid principle and settled position of law was totally ignored 

by the High Court while laying down that Article 137 of the Limitation Act 

would be applicable to the facts and circumstances of the present case.

39.    We   would,   however,   agree   with   the   position   that   such   a   power 

cannot   be   exercised   by   the   revisional   authority   indefinitely.       In   our 

considered  opinion,   such   extra   ordinary   power   i.e.   suo   motu   power   of 

initiation of revisional proceeding has to be exercised within a reasonable 

period of time and what is   a reasonable period of time would depend on 

the facts and circumstances of each case.

40.    For   this   proposition,   a   number   of   decisions   of   this   Court   can   be 

referred to on which reliance was placed even by the counsel appearing for 

the respondent.

41.  In Sulochana Chandrakant Galande Vs. Pune Municipal Transport 

and   Others  reported   in  (2010)   8   SCC   467,  this   Court   dealing   with   the 

issue of "reasonable time" held as follows:-

          29. In view of the above, we reach the inescapable conclusion 

          that   the   revisional   powers   cannot   be   used   arbitrarily   at   a 

          belated stage for the reason that the order passed in revision 

          under   Section   34   of   the   1976   Act,   is   a  judicial   order.   What 

          should be reasonable time, would depend upon the facts and 

          circumstances of each case.

42.    In  Govt.   of   India   v.   Citedal   Fine   Pharmaceuticals,   Madras   and 

Others reported in  (1989) 3 SCC 483: 

          6.   ......While   it   is   true   that   Rule   12   does   not   prescribe   any 

          period within which recovery of any duty as contemplated by 

          the rule is to be made, but that by itself does not render the 

          rule   unreasonable   or   violative   of   Article   14   of   the 

          Constitution. In the absence of any period of limitation it is 

          settled that every authority is to exercise the power within a 

          reasonable  period. What  would  be  reasonable  period,   would 

          depend upon the facts of each case.....

43.    In  State of Punjab & Ors.   v. Bhatinda District Cooperative Milk 

Producers Union Ltd. reported in (2007)
                                                       11 SCC 363   

          18.   It   is   trite   that   if   no   period   of   limitation   has   been 

          prescribed, statutory authority must exercise its jurisdiction 

          within   a   reasonable   period.   What,   however,   shall   be   the 

          reasonable   period   would   depend   upon   the   nature   of   the 

          statute,   rights   and   liabilities   thereunder   and   other   relevant 

          factors.

44.    Now,   the   question   that   arises   for   our   consideration   is   whether   the 

power   to   exercise   Suo   motu   revisional   jurisdiction     by   the   Joint 

Commissioner   in   the   present   cases   was   exercised   within   a   reasonable 

period.     On perusal of the records, we find that such powers have been 

exercised   within   about   three   years   of   time   in   some   cases   and   in   some 

cases   soon   after   the   expiry   of   three   years   period.     Such   period   during 

which power was exercised by the Joint Commissioner cannot be said to 

be unreasonable by any stretch of imagination in the facts of the present 

case.       Three   years   period   cannot   be   said   to   be   a   very   long   period   and 

therefore, in all these cases, we hold that the power was exercised within 

a reasonable period of time.

Issue   3:   Whether   the   order   dated   26.11.2007   passed   by   the   Joint 

Commissioner is proper and could be maintained;

45.    Having decided the aforesaid two issues in the aforesaid manner, the 

next     and the  last  issue   that  arises for  our  consideration   is  whether   the 

order   dated   26.11.2007   passed   by   the   Joint   Commissioner   setting   aside 

the   revised   assessment   order   dated   27.12.2003   is   proper   and   could   be 

maintained, as the said order was passed during the pendency of the writ 

petition in the High Court.

46.     On this issue also, we have heard the learned counsel appearing for 

the   parties.   The   aforesaid   order   dated   26.11.2003   was   passed   while   the 

respondent was fighting out the litigation in the High Court and therefore, 

it was not possible for the assessee to give his entire focus and attention 

and   also   to   give   full   concentration   to   the   aforesaid   proceeding   pending 

before   the   Joint   Commissioner.     The   learned   counsel   appearing   for   the 

appellant   also   could   not   dispute   the   fact   that   the   respondent   was 

somewhat handicapped in contesting the aforesaid matter very effectively 

before the Joint Commissioner.   

47.    Considering the entire facts and circumstances of the case, we also 

set   aside   the   order   dated   26.11.2007   and   remit   back   the   matter   to   the 

Joint Commissioner once again to hear the parties and to pass fresh order 

in   respect   of   the   legality   and   propriety   of   the   revised   assessment   order 

dated 26.12.2003.  Consequently, the matter is now remitted to the Joint 

Commissioner of Commercial Taxes to pass order in accordance with law 

giving   reasons   for   its   decisions   as   expeditiously   as   possible.     The 

impugned   judgment   and   order   passed   by   the   High   Court   is   set   aside   to 

the aforesaid extent while remitting back the matter as aforesaid, leaving 

the parties to bear their own costs. 

                                                .....................................................J

                                           (Dr. MUKUNDAKAM SHARMA)

                                                .....................................................J

                                        (ANIL R. DAVE)NEW DELHIAUGUST 10, 2011

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