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Judgment
Yogeshwar Dayal, C.J.—By this petition the petitioner has challenged the vires of section 30-C of the A.P. General Sales Tax Act as being ultra vires the powers of the State Legislature as conferred by entry 54, List II of the Seventh Schedule to the Constitution. The order of forfeiture passed u/s 30-C of the A.P. General Sales Tax Act is also challenged.
So far as the merits of the question are concerned, the petitioner has a right of appeal under the Act and the appellate authority is the proper forum to decide whether the case falls u/s 30-C or not. It is not appropriate for this Court to go into the merits of the case under article 226 of the Constitution of India, when there is the alternate remedy of appeal.
So far as the validity of section 30-C is concerned, the ratio decidendi of the decision of the Supreme Court in Kasturi Lal Harilal Vs. State of U.P. and Others, is adverted to. In that decision the Supreme Court has specifically held that providing procedure for disbursement of amounts wrongly realised by a dealer as tax is within the legislative competence of the State Legislature and constitutionally valid.
Section 30-C of the A.P. General Sales Tax Act reads :
"30-C. Imposition of penalty for contravening certain provisions. - (1) If any person not being a dealer liable to pay tax under this Act, collects any sum by way of tax, or being a dealer collects any amount by way of tax, in excess of the tax payable by him, or otherwise collects tax, in contravention of the provisions of section 30-B, any sum so collected shall be forfeited either wholly or partly to the State Government and in addition he shall be liable to pay a penalty of an amount not exceeding two thousand and five hundred rupees :
Provided that the assessing authority shall, while imposing the penalty or forfeiture, take into consideration the amount refunded to the purchaser from out of the amount collected by way of tax in contravention of section 30-B or for the refund of which satisfactory arrangement has been made :
Provided further that where any penalty or forfeiture imposed under this section has become final, it shall not be competent for the assessing or revisional authority to reopen any such assessment on the ground that a dealer is liable to tax or that he is liable to tax at a higher rate.
(2) No order for the forfeiture under this section, shall be made after the expiration of three years from the date of collection of the amount referred to in sub-section (1) :
Provided that in computing the period of three years under this sub- section, the period during which any stay order was in force or any appeal or other proceeding in respect thereof was pending shall be excluded.
(3) If the assessing authority in the course of any proceeding under this Act, or otherwise has reason to believe that any person has become liable to a penalty with or without forfeiture of any sum under sub-section (1) such authority shall serve on such person a notice in the prescribed form requiring him on a date and at a place specified in the notice to attend and show cause why a penalty with or without forfeiture of any sum as provided in sub-section (1) should not be imposed on him.
(4) The assessing authority shall thereupon hold an enquiry and shall make such order as he thinks fit.
(5) No prosecution for an offence under this Act, shall be instituted in respect of the same facts on which a penalty has been imposed under this section."
In the aforesaid case the Supreme Court was concerned with the competence of the U.P. Legislature in enacting a provision like section 29-A of the U.P. Sales Tax Act, which provided of procedure for determination of the amount wrongly realised by the dealer as tax. Section 29-A reads as follows :
"29-A. Procedure for disbursement of amounts wrongly realised by dealer as tax. - (1) Where any amount is realised from any person by any dealer purporting to do so by way of realisation of tax on the sale of any goods to such person, such dealer shall deposit the entire amount so realised into the Government Treasury, within such period as may be prescribed, notwithstanding that the dealer is not liable to pay such amount as tax or that only a part of it is due from him as tax under this Act.
(2) Any amount deposited by any dealer under sub-section (1) shall, to be extent it is not due as tax, be held by the State Government in trust for the person from whom it was realised by the dealer, or for his legal representatives, and the deposit shall discharge such dealer of the liability in respect thereof to the extent of the deposit.
(3) Where any amount is deposited by any dealer under sub-section (1), such amount or any part thereof shall, on a claim being made in that behalf in such form as may be prescribed, be refunded, in the manner prescribed, to the person from whom such dealer had actually realised such amount or part, or to his legal representatives, and to no other person :
Provided that no such claim shall be entertained after the expiry of three years from the date of the order of assessment or one year from the date of the final order on appeal, revision or reference, if any, in respect thereof, whichever is later.
Explanation. - The expression ''final order on appeal, revision or reference'' includes an order passed by the Supreme Court under article 32, article 132 or article 137, or by the High Court under article 226 or article 227 of the Constitution."
Under the present section 30-C, if a dealer has collected any amount in excess, it is contemplated that the amount shall be forfeited either wholly or partly to the State Government and sub-section (4) authorises the assessing authority to hold an enquiry and make such order "as it thinks fit". Under the proviso to sub-section (1) of section 30-C, the same authority, if the consumer can be traced, can order the payment to him of the amount illegally collected from him. Merely because there is no express provision for refund of it to the consumer, it does not mean that the said proviso to section 30-C is outside the purview of entry 54 of List II of the Seventh Schedule. In fact, in R.S. Joshi, Sales Tax Officer, Gujarat and Others Vs. Ajit Mills Limited and Another, speaking through Krishna Iyer, J., the Constitutional Bench of the Supreme Court held as follows :
"The forfeiture clause in1 37(1) cannot be charged with the vice of colourability. The word ''forfeiture'' must bear the same meaning of a penalty for breach of a prohibitory direction. The fact that there is arithmetical identity, assuming it to be so, between the figures of the illegal collections made by the dealers and the amounts forfeited to the State cannot create a conceptual confusion that what is provided is not punishment but a transference of funds. In this view, the legislature, by inflicting the forfeiture, does not go outside the crease when it hits out against the dealer and deprives him, by the penalty of the law, of the amount illegally gathered from the customers.
The notion that a penalty or a punishment cannot be cast in the form of an absolute or no fault liability but must be preceded by mens rea must be rejected. The classical view that ''no mens rea, no crime'' has long ago been eroded especially regarding economic crimes. Therefore, the contention that section 37(1) fastens a heavy liability regardless of fault has no force in depriving the forfeiture of the character of penalty."
In any case, it is clear from the provisions of section 30-C that the assessing authority can find the consumer and pass appropriate orders for refund. Even if there is no such express provision, the constitutional validity of section 30-C cannot be challenged as beyond the scope of entry 54. In view of the aforesaid ratio decidendi of the decision of the Supreme Court in R.S. Joshi, Sales Tax Officer, Gujarat and Others Vs. Ajit Mills Limited and Another, there are no merits in the submission that section 30-C is constitutionally invalid and beyond the legislative power of the State Legislature or that it is violative of articles 14 and 19 of the Constitution. So far as the merits of the controversy are concerned, the petitioner has got an alternate remedy and he can avail of it.
The writ petition is accordingly dismissed. No costs.
Writ petition dismissed.