SALES TAX OFFICERS AND ORS. versus M/S. DUTTA TRADERS

Citation: [2007] 10 S.C.R. 114 · Decided: 18-09-2007 · Supreme Court of India · Bench: S.H. KAPADIA, B. SUDERSHAN REDDY · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
SALES TAX OFFICERS AND ORS. 
V. 
MIS. DUTT A TRADERS 
SEPTEMBER 18, 2007 
B 
[S.H. KAPADIA AND B. SUDERSHAN REDDY, JJ.] 
Orissa Sales Tax Act, 1957: 
.-./ 
l 
c 
s. 16-D-Power of Sales Tax Officer (Vigilance) to recover Sales 
Tax and impose penalty-Irregularities detected by Investigating 
Officer of Vigilance Wing during unloading the biscuits from a 
vehicle-Sales Tax Officer (Vigilance) raised tax and imposed 
penalty-Held, in view of the delegation of powers by the 
D Commissioner, by Notification dated 14.5.1997 to the Sales Tax 
Officers area-wise, the Sales Tax Officer appointed to search and seize 
has been given power uls l 6D also to recover the amount on the spot. 
ss. 16-D and 12-Assessment and recovery of tax-Held: word 
' assess' in s.16-D has different connotation-It talks about 
E computation-Under s. 16-D where assessee offers to pay tax on spot 
for release of his goods Sales Tax Officer is required to calculate/ 
compute the tax, on payment whereof he allows the goods to be 
released-This computation is also assessment-In this context Sales 
Tax Officer (Vigilence) is empowered to 'assess' and raise tax-
y 
F However this assessment has nothing to do with regular assessment 
--\-
uls 12-0ffice of Commissioner of Commercial Tax Orissa Notification 
No. 110008/C.T dated 14.5.1997. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7540 of 
2001. 
G 
From the Judgment and Order dated 04.09.2000ofthe High Court 
of Orissa, Cuttack in O.J.C. No. 7135 of2000. 
Rakesh Dwivedi, Kirti Renu Mishra for the Appellants. 
H 
114 
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SALES TAX OFFICERS v. MIS. DUTT A TRADERS 
115 
AK. Sanghi and Rono Mohanty for the Respondents. 
A 
j 
The following Order of the Court was delivered : 
ORDER 
1. Respondent is a wholesale dealer in biscuits of different brands B 
under the provisions of the Orissa Sales Tax Act, 194 7 and Central Sales 
Tax Act, 1956. On 14th October, 1999, goods were being unloaded from 
vehicle No.WB-24-A-0112 when the Investigating Officer of Vigilance 
Wing, Balasore Division, found certain irregularity and, accordingly, the 
·,..,.._ 
Sales Tax Officer (Vigilance), raised a sum of Rs. 32,592/- as tax and 
Rs. 54,320/- as penalty under Section 16-D of the Orissa Sales Tax Act, c 
1947 (for short, the Act). 
2. The main contention of the respondent is that the Sales Tax Officer 
(Vigilance) is not competent to make assessment under Section 16-D of 
the Act inasmuch as he is an officer under the control of Inspector General D 
of Police (Vigilance) and has no power to make assessment. 
3. Under notification dated 14th May, 1997, the Commissioner 
delegated his powers and duties under Section 16-D of the Act to the 
Sales Tax Officers and Inspectors of Sales Tax Department. The said 
notification was issued under Section 3(3) of the Act. The notifications E 
issued indicate officers by designation who have been conferred with the 
powers of the Commission. 
4. By a cryptic order, the High Court opined that since the Sales 
y 
Tax Officer (Vigilance) had been functioning under the Inspector General 
,> . 
of Police (Vigilance), he was not competent to realize the amount and, F 
therefore, the realization of the aforestated amounts as tax and penalty 
was without jurisdiction and, accordingly, the order of the Additional 
Commissioner dated 1st January, 2000 stood quashed. Against the said 
judgment, the Department has come to this Court by way of Civil Appeal. 
G 
5. Two questions arise for consideration in this Civil Appeal. Firstly, 
-y 
whether the High Court was right in holding that the Sales Tax Officer 
(Vigilance) was not entitled to realize the aforestated amounts as he has 
been functioning under the Inspector General of Police (Vigilance). The 
second question is whether the Sales Tax Officer (Vigilance) was entitled H 
116 
SUPREME COURT REPORTS 
[2007] 10 S.C.R. 
A to assess and recover/realize the sum of Rs.32,592/- as tax from the 
assessee. 
6. On the first question, we quote hereinbelow Section 17 of the 
Act. 
B 
17. Delegation of Commissioner's Functions. 
c 
Subject to such conditions and restrictions as the State 
Government may, be general or special order, impose, the 
Commissioner may, by order m writing, delegate any of his powers 
and duties under this Act or the rule made thereunder, to any 
person appointed under Section 3 to assist him. 
On reading Section 17 of the Act, it is clear that the Commissioner is 
empowered, by an order in writing, to delegate any of his po
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