Bhubaneswar Flour Mills v. State Of Orissa Opp. Party.

R.N Misra, C.J:— At the instance of the assessee, this Court under section 24(1)(b) of the Orissa Sales Tax Act, 1947, directed the Sales Tax Tribunal to state a case and refer the following question for opinion of the Court:—

“Whether second appeals on merit lie under the provisions of the Orissa Sales Tax Act when the connected first appeals have been summarily dismissed under Rule 49 of the Orissa Sales Tax Rules.?”

2. We are concerned with two periods of assessment, being 1971-72 and 1972-73. Aggrieved by the orders of assessment, the assessee preferred appeals before the Assistant Commissioner of Sales Tax on 8-5-1975. After certain adjournments, the appeals were dismissed on 28-7-1975 under Rule 49 of the Orissa Sales Tax Rules for non-removal of defects. Against this summary rejection of the appeals, second appeals were filed by the assessee where exercise of power by the first appellate authority in rejecting the appeals was challenged for want of reasonable opportunity and merits of the appeals were canvassed. The Tribunal came to uphold the rejection of the first appeals by the Assistant Commissioner and further held that once the appeals had been summarily dismissed by the first appellate authority, the ambit of second appeals did not relate to examination of the merits of the assessment. The real question for consideration, therefore, is as to whether when the first appeals have been dismissed noton merit but on account of procedural defects and second appeals are carried to the Tribunal, the appeals would lie on merit and are not confined to the question which has been canvassed in the first appeals.

3. This Court in an unreported decision, being the case of Sri Natabar Sahoo v. State Of Orissa . S.J.C No. 102 of 1973-D/22-9-1975., held that when the first appeal had been dismissed as barred by limitation, in second appeal the question of dismissal of the first appeal on the ground of limitation would be available for examination and the second appellate authority would not be entitled to examine the merit of the dispute raised in assessment.

4. The learned counsel for the assessee relies upon the famous case of the Supreme Court in Mela Ram & Sons v. Commissioner Of Income Tax, Punjab . 1956 29 I.T.R 607. as also a Bench decision of the Madhya Pradesh High Court in the case of Purshottamdas Mathura-das and Co. Pvt Ltd. v. The Commissioner of Sales Tax, Madhya Pradesh . 23 S.T.C 319.. The Supreme Court decision (Mela Ram & Sons v. Commissioner Of Income Tax, Punjab) was referred to in Natabar Sahoos case. Referring to this case, the Division Bench of this Court observed:—

“5. The point for consideration in that case was whether upon summary rejection of a first appeal under Rule 49 of the Orissa Sales Tax Rules, a second appeal would he to the Tribunal. Narasimham, C.J, relied upon a decision of the Supreme Court in the case of Mela Ram & Sons v. I.T Commissioner, A.I.R 1956 Supreme Court, 367, to hold that even when a first appeal was summarily dismissed, it amounted to an, appellate order and, therefore, a second appeal lay. From both the decisions, we do not find any support for the contention advanced on behalf of the assessee that in second appeal before the Tribunal, the assessee would be entitled to raise contentions on merit of the matter. As already pointed out, the assessees first appeal was thrown out as being tarred by time. Though for purposes of preferring a second appeal, such summary dismissal amounts to an appellate order, for purposes of the dispute on merit there was actually no first appeal and if we accept Mr. Pasayat's contention that even in such circumstances a second appeal on merit be tenable, it would mean that without disputing facts on merit in a first appeal, a second appeal shall be tenable……………”

5. It, therefore, follows that Mela Raw's case, was referred to and relied upon in the unreported decision of this Court. Having examined the decision in Mela Ram's case somewhat closely, we are inclined to reiterate the view expressed in the unreported decision of this Court that there is nothing stated therein which would support the view that where the first appeal has been dismissed not on merit but for reasons otherwise, the second appeal would lie on merit.

6. The other case which has been cited does support the view of Mr. Pa say at for the assessee. The Madhya Pradesh High Court observed:—

“6. When an appeal is dismissed in default, there is thus an additional right to get the appeal readmitted for hearing provided the assessee can satisfy the appellate authority that he was prevented by any sufficient cause for appearing when the appeal was called on for hearing.

7. But this additional right does not detract from the right which the assessee has under sub-section (1) of section 22 read with rule 53(4) ibid of going up in second appeal to the Board of Revenue; and when he does so go up, his appeal is not and cannot be restricted to the examination of the question whether the dismissal for default was proper or not. The dismissal in default cannot put the assessee in a worse position than if his appeal had been dismissed on merits, in which case he would have had a right of appeal to the Board of Revenue on the merits of his assessment………………”

7. These observations of the Madhya Pradesh High Court do somewhat support the petitioner's stand, but we do not see any justification to discard the view in Natabar Sahoos case, and adopt the rule of the Madhya Pradesh case.

8. On the other hand, we are prepared to take the view that where the first appeal is dismissed without examination of merits on some technical ground procedural defect, in second appeal the merit of the matter would not be available to be adjudicated though a second appeal lay by treating the dismissal of the first appeal as an appellate order. In these circumstances, the question formulated does not fall for answer.

9. No costs.

B.K Behera, J.:— I agree with my Lord the Chief Justice.

10. Ordered accordingly.