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Judgment
This petition under Section 226 of the Constitution of India challenges the order passed by the Appellate Authority. We have heard Mr. Shridharan, learned Senior Advocate and Mr. Thakar appearing on behalf of the petitioner and Mr. Sharma, learned AGP appearing on behalf of the respondents. The petitioner really presses prayer clause (c) which reads as under:-
"(c) That in the alternative, this Hon''ble High Court be pleased to issue Writ of Certiorari or any other appropriate Writ, Order or direction and be pleased to call for and examine the records of the First Appeal order and all other relevant records and be pleased to restore the First Appeals (Exhibit "C") for fresh decision."
The precise contention of Mr. Sridharan is that by virtue of Section 55 of the Bombay Sales Tax Act, 1959 and the pari materia provision in Maharashtra Value Added Tax Act,2002, so also Rule 61 of the Bombay Sales Tax Rules, 1959 and the pari materia Rule in the Maharashtra Value Added Tax Rules,2005 the Appellate Authority has no power to dismiss the appeal for non prosecution. The law mandates in terms of Section 55(7)(a) to (c) powers of confirmation, reduction, enhancement and annulment of the assessment order, setting aside of an order of penalty or interest, and that order could either be confirmed or cancelled or varied so as to enhance or reduce the penalty, and in any other case means the case not covered by clause (a) and (b) of Sub-section 7 of Section 55, may pass such orders as the appellate authority may deem just and proper. Thus, this power does not take within its import a power to dismiss an appeal for want of prosecution. In the present case, the appeal has been dismissed by the first Appellate Authority for want of prosecution and that has caused serious prejudice.
To establish the prejudice caused, Mr. Sridharan invited our attention to page 46 of the paper book at "Annexure C" which is a copy of the order of first Appellate Authority dated 28.12.2012. Mr. Sridharan would submit that the letter at page 45 records that an inspection was taken of the assessment files on 20.12.2012. The record including the proceeding sheets for the period 1992-93, 1994-95 to 1998-99 under BST/CST Acts and for the period 2000-01 to 2004-05 under BST Act, was thus made available in January,2013, but the Tribunal heard the matter on 14.12.2012 whereas the learned Advocate had sought time to take inspection and, thereafter, to address the first Appellate Authority. However, the appeal was dismissed for non prosecution on 28.12.2012.
Mr. Sridharan, therefore, would submit that the prejudice caused be corrected by this Court in its plenary and supervisory jurisdiction by issuing the writ as claimed for.
In support of the above contentions, heavy reliance is placed on the judgment of the Hon''ble Supreme Court in the case of Balaji Steel Re-Rolling Mills Vs. C.C.E. and Customs, )". The argument is that this judgment is on all fours and fully applicable.
On the other hand Mr. Sharma, learned Counsel appearing on behalf of the Revenue would support the concurrent orders. He would submit that the order is not an order of dismissal of the appeal for want of prosecution simplicitor. The order assigns reasons was to why the Appellate Authority did not deem it fit and proper to interfere with the assessment order. There is no material on record to arrive at any conclusion and as desired by the petitioner. The argument that the records were lost in the flood of 2005 in Mumbai, is baseless. It is not a dismissal for want of prosecution but dismissal of the appeal on merits. In the absence of record and to support the grounds in the appeal, the appeal has been rightly dismissed. There is, therefore, a merger now and in the light thereof the order based on mixed question of law and fact does not call for any interference in writ jurisdiction. The judgments relied upon have no application and the petition be dismissed.
Today the matter was placed for passing final order and after the arguments concluded earlier. However, purely to allow Mr. Sridharan to make legal submissions that we have gone into the record once again with his assistance.
On the own showing of the petitioner, it is apparent that it is a Limited Company which is a registered dealer under the Bombay Sales Tax Act, 1959 and the Central Sales Tax Act, 1956. It is manufacturer of pharmaceutical products like formulations and bulk drugs. It faced financial difficulties and, therefore, approached the Board for Industrial and Financial Reconstruction set up under the Sick Industrial Companies (Special Provisions) Act, 1985. The pendency of the proceedings, there and it is conceded, cannot bar the assessment and the orders in that behalf under the Bombay Sales Tax Act, 1959. The returns were filed and according to the Authority assessing the returns, the Assessment Order has been made and which must visit the petitioner with some liability and as computed thereunder. In the Assessment Order copy of which is at page 30 of the paper book, an attempt is made to point out that records are lost on account of floods. That issue has been raised by the petitioner. The Assessing Officer noted that the Constituted Attorney of the petitioner contended that the books of accounts are destroyed in the flood in July,2005. He submitted a copy of the affidavit of the current Directors of the petitioner. However, he produced copies of few shipping bills, bank certificates for POB value for the periods 1995, 1996 and 1997. The Assessing Officer, therefore, wondered that if the record was destroyed in the flood, then, how come these documents were produced, where the books of accounts were kept and whether they are at all destroyed. The explanation in that regard has been considered extensively on page 30 and 31 and the Assessing Officer noted that the administrative office of the petitioner is in Navi Mumbai. As far as Navi Mumbai is concerned and particularly in Turbhe area, there was not such damage in July,2005 floods, as would have enable the petitioner to raise a plea of this nature, is the conclusion reached. It is, therefore, clear that the observations at page 31 cannot be seen in isolation but based on what was the request made by the petitioner. If the books of accounts were available and indeed some of them could be produced, then, the assessment order indicates that based on the same an assessment can be finalised. It can also be finalised on the basis of gross turnover and sales and determined from the records available with the Assessing Officer.
When the appeal was filed against such order, once again the First Appellate Authority noted that the thirteen appeals which have been filed were within limitation. They were placed for final hearing on 14.12.2012. On that date the appellant sought inspection of the file which was granted. The Advocate confirmed that he has taken inspection of files. We do not go into this issue and now permit any affidavit or explanation being tendered as to whether the inspection taken was indeed complete or not taken at all. What is essentially relied upon before us is the fact that the first Appellate Authority dismissed the appeal for non attendance and for non prosecution. However, at a closer look at this order would reveal that it is only in the operative part these two lines or two sentences relied upon are appearing. However, prior thereto there is complete observation and finding that the appellant -petitioner has not produced any books of accounts related to the grounds of appeal. The explanation was that the books were destroyed in the flood of 2005. However, the First Appellate Authority held that the Assessing Officer verified this issue and concluded that the petitioner -appellant has not submitted any proof of destruction of books in the flood of 2005. It is not as if that flood of 2005 is a disputed fact, but what is destroyed therein and which record belonging to the dealer or which file, is the real issue. That has not been spelt out and that is why the explanation was not found to be acceptable. If it was not a bonafide explanation and the matter was not concluded by the First Appellate Authority for want of appearance or for want of prosecution of the appeal but on merits, then, this cannot be said to be an order dismissing the appeal for want of prosecution. The petitioner -appellant has not produced any evidence which can substantiate his claim of destruction of books of accounts. The Assessing Officer, therefore, applied best judgment test in the assessment order and concluded the assessment. It is such exercise of the Assessing Officer which has been upheld. That additionally the petitioner did not evince interest and therefore, remained absent at the hearing or his representative sought time and by raising a plea of absence of inspection of record, does not mean that the order dismisses the appeal for want of prosecution.
If that had been the only issue in challenging such an order before the Tribunal, there was no reason for the petitioner to have raised several grounds in the Memo of Appeal. There was a specific request made to the Tribunal that if the Tribunal feels appropriate that merits of the case be decided in second appeal, the petitioner-appellant prayed for an opportunity of hearing of the appeal on merits. Therefore, we find that paragraph 5 of the Tribunal''s order at running page 92 considers the complete explanation. The Tribunal being last fact finding Authority, was of the view that it can permit the appellant-dealer to produce additional evidence. The dealer should not be penalised because he could not produce the relevant evidence before the Assessing Officer or First Appellate Authority. The dealer is required to produce evidence to show that he is in custody of the relevant books of accounts. However, the plea is that all books of accounts are lost or destroyed. It is surprising as the Tribunal has noted that nothing is produced showing that the Petitioner has informed the necessary authorities about loss or destruction of the books of accounts. The oral explanation or assertion of the petitioner before the Tribunal about such destruction was held to be insufficient. That is why this explanation was not accepted. Then, a reference was made to the rehabilitation package sanctioned by the Authorities under the Sick Industrial Companies (special provision) Act (SICA). That record also could not be produced and to the satisfaction of the Tribunal. The argument that the reference is pending under the said Act namely SICA is not enough to stop the assessment or block the assessment proceedings, is also the conclusion reached. The plea of remand of the case back to the Assessing Officer was also then considered. Therefore, while rejecting it, the Tribunal found that this is not a matter fit for remand as it will be only putting premium on delaying tactics. We are surprised at the stand in this petition because when the Tribunal''s order was passed in April,2013 the record was indeed available. If it was available and inspected and copies were taken in January,2013, then nothing prevented the petitioner requesting the Tribunal to peruse the record in its possession and/or the record of assessment and then decide the petitioner''s claim. Even at stage of rectification proceeding.
We find that the Tribunal was requested to correct its order and on the ground that it causes prejudice. There as well the Tribunal found that despite several opportunities, no evidence could be produced with regard to the destruction of books of accounts in floods and that plea, therefore, is not substantiated. Surely, this is not a case where the judgment of the Supreme Court in the case "Balaji Steel Re-Rolling Mills" (supra) would come to the aid or assistance of the petitioner. Once the dismissal of the appeal by the Appellate Authority is not for want of prosecution or for want of attendance but by dealing with the merits of the matter including the claim that there are no records available because of destruction by floods, then, the principle in "Balaji Steel Re-Rolling Mills" (supra) can have no application. That was a case where the Hon''ble Supreme Court found that the dismissal for want of prosecution simplicitor and without any adjudication on merits, is a course impermissible and unknown to the appellate power under the Income Tax Act, 1961, the Central Excise Act, 1944 and which are pari materia provisions. This judgment of the Hon''ble Supreme Court and equally our orders following it, cannot have any application to the facts and circumstances of the present case. It is distinguishable.
As a result of the above above discussion, we do not find any merit in the Writ Petition. It is, accordingly, dismissed with no order as to costs.