judgement:
Appeal No. 2421 of 1968.
Appeal from the judgment and order dated January 31, 1967 of the Madhya Pradesh High Court in Misc.
Civil Case No. 88 of 1966.
R. N. Sachthey and B. D. Sharma, for the appellant.
Rameshwar Nath and Swaranjit Sondhi, for the respondent.
The Judgment of the Court was delivered by Grover, J.
This is an appeal by certificate from a judgment of the Madhya Pradesh High Court in an Income tax Reference.
The Reference related to the assessment made on the assessee for the year 1962 63 for which the accounting period was the year ending March 31, 1962.
The assessee carried on business as sole, selling agent of M/s. Mohanlal Hargovindas, Jabalpur.
The assessee succeeded to this business on the death of her husband on or about February 17, 1960.
It would appear that M/s. Mohanlal Hargovindas had recovered a certain amount towards sales tax from the assessee 's husband relating to the period January 26, 787 1950 to March 31, 1951.
In an appeal filed by the said firm, however, the Assistant Commissioner of Sales Tax remitted the sum of Rs. 24,341/ so recovered by the firm by an order dated November 31, 1960.
Consequently M/s. Mohanlal Hargoving das refunded that amount to the assessee by means of a draft dated October 31, 1961.
This draft was received by the assessee on November 9, 1961 which fell in the accounting period.
The Income tax Officer sought to tax this amount under the provisions of section 41 (1) of the Income tax Act 1961, hereinafter called the 'Act '.
He did not accede to the contention of the assessee that the income, if at all, was the income of the assessee 's deceased husband and not her income.
The Appellate Assistant Commissioner dismissed the appeal filed by the assessee.
The Tribunal acceded to the contention of the assessee that since the allowance or deduction in question had been obtained by a different assessee, namely, her husband she was not liable to pay tax on that amount under section 41 (1) of the Act.
The Tribunal was moved by the Commissioner of Income tax for stating a case and referring the following question to the High Court : "Whether the sum of Rs. 24,341 was liable to tax under section 41 (1) of the Income tax Act, 1961 ?" The High Court answered the question in favour of the assessee.
Section 41(1) is in the following terms: "41 (1) Where an allowance or deduction, has been made in the assessment for an year in respect of loss, expenditure or trading liability incurred by the assessee, and subsequently during any previous year the assessee has obtained whether in cash or in any other manner whatsoever, any amount in respect of such loss or expenditure or some benefit in respect of such trading liability by way of remission or cessation thereof, the amount obtained by him or the value of benefit accruing to him, shall be deemed to be profits and gains of business or profession and accordingly chargeable to income tax as the income of that previous year, whether the business or profession in respect of which the allowance or deduction has been made is in existence in that year or not".
As pointed one by the High Court under the general law if a trading liability has been allowed as a business expenditure and, if this liability is remitted in any subsequent year the amount remitted cannot be taxed as income of the year of the remission nor can the account for the year id which the liability was allowed be reopened or adjusted.
Section 41(1) was enacted to supersede this principle but this section can apply only to the a In 788 the present case if the husband of the assessee had been alive and had received the amount which had been remitted during his lifetime he would certainly have been liable to pay tax under the provisions of section 41(1).
But Kanhaiyalal having died and his widow being the assessee she cannot possibly be brought within the section.
Section 2(7) of the Act defines the word "assessee".
The definition is very general and assessee is stated to mean a person by whom income tax or super tax or any other sum of money is payable under the Act and includes every person as mentioned in clauses (a), (b) and (c).
The assessee, in the present case, does not fall within any of those clauses.
There is no specific provision in the Act under which it can be said that the assessee is a person by whom income tax is payable on the amount of Rs. 24,341/ which came to her by way of remission on account of what had transpired in the lifetime of her husband.
The Act does not contain any provision making a successor in business or the legal representative of an assessee to whom an allowance has already been granted liable to tax under section 41(1) in respect of the amount remitted and received by the successor or the legal representative.
The only provision which relates to the liability of the legal representative is section 159 of the Act.
Sub section (1) thereof provides that where a person dies his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died in the like manner and to the same extent as the deceased.
The corresponding provision in the Income tax Act 1922 was section 24B.
In Commissioner of Income tax Bombay vs Amarchand N., ' Shroff (1) it was laid down by this Court that section 24B did not authorise the levy of tax on receipts by the legal representative of a deceased person in the year of assessment succeeding the year of account being the previous year in which such person died.
The assessee had ordinarily to be a living person and could not be a dead person.
By section 24B the legal personality of the.
deceased assesses was extended for the duration of the entire previous year in the course of which he died.
The income received by him before his death and that received by his legal representative after his death but in that previous year became assessable to income tax in the relevant assessment year.
Any income received in the year subsequent to the previous year or the accounting year could not be called income received by the deceased person.
Thus the provisions of section 24B did not extend to tax liability of the estate of a deceased person beyond the previous or the accounting year in which that person Income tax, Bombay vs James Anderson(1).
Indeed the learned counselfor the Revenue did not and could not rely on the provisions of section 159 of the Act in the present case nor was any reliance (1)1.
T. R. 59.
(2) 51 789 placed on any other section in the Act apart from section 41 (1).
The, question referred is also based on that very section.
That section, in our opinion cannot possibly apply to the present case because the assessee who is now sought to be taxed is not the assessee contemplated by that section.
The assessee within section 41 (1), namely, Kanhaiyalal having died the Revenue could not take any advantage of its provisions.
The High Court rightly observed that the question whether the amount of Rs. 24,341/ was liable to tax as the personal income of the assessee did not arise in the present case in which the sole point to be decided was whether that amount was assessable in the assessee 's hands under section 41 ( 1 ) of the Act.
We, therefore, entirely concur in the view of the High Court and agree with the answer returned by it.
In the result the appeal fails and it is dismissed with costs.
K.B.N. Appeal dismissed.

summary:
The assessee who was successor in business to her deceased husband was sought to be taxed under section 41 (1) of the Income tax Act, 1961, in respect of certain amount received by her by way of remission from the sales tax recovered from her husband.
On the 'question whether the amount was assessable under section 41(1) of the Act.
HELD : Section 41(1) does not apply, because, the assessee who is sought to be taxed is not the assessee contemplated by the section.
If the husband of the assessee had been alive and had received the amount which had been remitted during his life time he would certainly have been liable to pay tax under the provisions of section 41(1).
But the husband having died the Revenue could not take any advantage of its provisions.
The Act does not contain any provision making a successor in business or the legal representative of an assessee to whom an allowance has already been granted liable to tax under section 41(1) in respect of the amount remitted and received by the successor or the legal representative.
[788 C D, 789 A B] C.I.T., Bombay City vs Amarchand N. Shroff and C.I.T Bombay vs James Anderson, , referred to.


judgement:
Appeal No. 5 of 1971.
Appeal from the judgment and order dated December 18, 21, 1970 of the Bombay High Court in Special Civil Application No. 1583 of 1970.
section J. Sorabeje, M. O. Chinoy, J. R. Gagrat, and B. R. Agarwala, for the appellants.
V. section Desai and section B. Wad, for the respondents Nos. 1, 2, 4 and 7.
The Judgment of the Court was delivered by Ray, J.
This is an appeal by certificate under Article 133(1) (c) of the Constitution from the judgment dated 18 and 21 December, 1970 of the Bombay High Court.
The Bombay High Court issued a writ of quo warranto declar ing that respondent No. 3 Dr. Balkrishna Pandurang Apte is not entitled to act as the Vice Chancellor of the University of Poona 599 is pursuance of the election held on 9 May, 1970 and further restraining him from acting as the Vice Chancellor.
H. V. Pataskar, the Vice Chancellor of the University of Poona died on 21 February, 1970.
The Governor of Bombay who is the Chancellor of the University then nominated Maha Mahopadhyaya Datto Vaman Potdar to act as the Vice Chancellor until the date on which another Vice Chancellor was elected under sub section (1) of section 11 of the Poona University Act, 1948 (hereinafter referred to as the Act).
Under section 12 of the Act the Vice Chancellor is the prin cipal executive and academic officer of the University.
Under section 11 of the Act the Vice Chancellor shall be elected by the Court from among three persons recommended by the Executive Council.
Section 56 of the Act provides that every election to the office of the Vice Chancellor and every recommendation for the nomination to the office of the Vice Chancellor under the Act shall be made by the system of proportional representation by.
means of a single transferable vote by ballot in such manner as may be prescribed by the Statutes.
At the meeting of the Executive Council held on 28 February, 24 March and 18 April, 1970 the Executive Council recommend ed a panel of three persons.
They were Dr. Balkrishna Pandurang Apte, Principal Narayan Ramchandra Kulkarni and Principal Narhar Govind Suru for election to the office of the Vice Chancellor.
These were the three candidates from amongst whom the Court of the University had to elect one as the Vice Chancellor.
The said meeting of the Court of the University was convened under notice dated 22 April, 1970 for 9 May, 1970 for election of the Vice Chancellor from amongst those three persons.
At the election held on 9 May, 1970 the total number of votes tendered was 149.
One of the votes was invalid.
The valid votes were 148.
The election was in accordance with section 56 of the Act by the system of proportional representation by means of a single transferable vote by ballot.
The result of the ballot papers appeared to be that Dr. Apte secured 58, Principal Kulkarni 37 and Principal Suru 53 first preference votes.
Principal Kulkarni was thus eliminated on the first count on the basis of the lowest number of first preference votes.
8 of the voters who had given first preference votes to Principal Kulkami had not exercised second preference in favour of either of the remaining two candidates Dr. Apte and Principal Suru.
The remaining 29 voters gave 12 second preference votes to Dr. Apte and 17 second preference votes to Principal Suru.
This resulted in both the continuing candidates Dr. Apte and Principal Suru each securing 70 votes on 600 the second count.
Dr. Apte was declared elected because in the first count, namely, the count previous to the one in which both obtained equal number of votes.
Dr. Apte had a clear majority of 5 votes and therefore Principal Suru was excluded from the election.
The election of Dr. Apte was challenged in the High Court on three principal grounds.
First, it was contended that the tie between Dr. Apte and Principal Suru at the second count was to be resolved by drawing of lots, because it was the ordinary practice in elections held under the system of proportional representation by means of a single transferable vote by ballot for election to a single seat that the tie of the above kind must be resolved by drawing of lots.
Secondly, it was said that the Principal of four Colleges, viz. N. D. M. V. P. Samaj 's Arts and Commerce College, Sinnar; V. P. Mandal 's Arts, Science and Commerce College, Thana; Narhar Balwant Thakur Law College, Nasik and G. E. Society 's College for Education, Sangamner which had not been duly affiliated at the date of the election had acted and voted at the election as members of the Court, and, therefore, the votes given by the members of those four colleges were invalid.
Thirdly, it was contended that the meeting for the election of the panel of respondents Dr. Apte, Principal Kulkarni and Principal Suru for election to the office of the Vice Chancellor was an invalid meeting and therefore the election was void.
The High Court upheld the first contention and rejected the other two.
The High Court held that when upon final count the continuing candidates Dr. Apte and Principal Suru secured equal majority of valid votes the system of proportional representation by means of a single transferable vote by ballot never aimed at excluding one of such continuing candidates by reference to any of the previous counts and/or of original vote.
The High Court held that where only two continuing candidates remained to fill up only one vacancy and both of them had the same number of votes the tie of votes between the two continuing candidates was to be solved by the principle of decision by lot.
Section 56 of the Act speaks both of election to the office of the Vice Chancellor or any authority of the University by the system of proportional representation by means of a single transferable vote by ballot in such manner as may be prescribed by the Statutes.
The authorities of the University are mentioned in section 15 of the Act.
The Vice Chancellor is not one of the authorities mentioned there.
The Vice Chancellor is one of the officers of the University.
The officers of the University are mentioned in section 8 of the Act.
601 Section 18 of the Act contemplated making of Statutes.
Statutes No. 142 to 165 are the relevant Statutes for elections to authorities.
These Statutes do not apply to election of Vice Chancellor because he is not an authority.
The system of election by proportional representation by means of a single transferable vote by ballot is the prescribed system of election to authorities.
The relevant Statute for election to authorities on which counsel for the appellants relied is Statute No. 158 in support of the proposition that it embodied the rule of exclusion of one of the two continuing candidates both of whom secured equal number of votes in the second count by reference to the principle as to which of the two continuing candidates had the lowest number of votes at the first count.
There is no doubt that Statute No. 158 does not in terms apply to the election of Vice Chancellor but it is manifest that Statute No. 158 embodies a rule of exclusion of one of the candidates at the second count on the ground that that candidate bad the lowest number of votes at the first count.
Election by proportional representation by means of a single transferable vote by ballot is often described as the Hare system of proportional representation named after the English political reformer Thomas Hare.
This system of election is based on a quota determined by the following formula.
The total votes cast is divided by the number of seats to be filled plus one, and one is added to the quotient.
If 100.000 votes are cast and 4 seats are to be filled, divide by 5 to get a quotient of 20,000 then add I to get 20,001, which is the quota.
A candidate receiving the quota of first choice of votes is elected.
Under this system electors ,express first, second.
third or additional choices according to the number of candidates.
An elector does not waste his vote.
If the candidate for whom he has expressed his choice, does not need his vote, the surplus votes are distributed in accordance with the indicated second choices among candidates whose quotas have not been filled.
If enough candidates are not elected by this process the candidate with the smallest number of choices is then excluded and his votes are distributed in the same way.
This process of ,exclusion or elimination goes on until enough candidates have filled their quotas or until the successive eliminations have left no more than enough to fill the vacancies.
In working out the method of election in the present case, it has to be noticed whether the manner in which Principal Suru has been excluded at the second count and Dr. Apte has been declared elected at the second count is a principle of exclusion which has been recognised in the system of proportional representation by means of a single transferable vote by ballot.
Counsel for the . appellants contended that there was legislative recognition of this principle in three cases.
The first is rule 75 of the Conduct of 602 Elections Rules, 1961.
The second is rule 6 in the Schedule to the Presidential and Vice Presidential Elections Rules, 1952.
The third is Statute No. 158 in the Statutes of the Poona University Act.
Rule 75 of the Conduct of Elections Rules is applicable in the case of counting of votes where only one seat is to be filled.
The two sub rules of Rule 75 on which reliance was placed by, counsel for the appellants for the legislative recognition of the principle of exclusion are (3) and (4) which are as follows : "(3).
If, at the end of any count, no candidate can be declared elected, the returning officer shall (a) exclude from the poll the candidate who up to that stage has been credited with the lowest value; (b) examine all the ballot papers in his parcel and sub parcels, arrange the unexhausted papers in sub parcels according to the next available preferences recorded thereon for the continuing candidates,, count the number of papers in each sub parcel and credit it to the candidate for whom such preference is recorded, transfer the sub parcel to that candidate.
and make a separate sub parcel of all the exhausted papers ; and (c) see whether any of the continuing candidates has, after such transfer and credit, secured the quota.
(4) If, when a candidate has to be excluded under clause (a) of sub rule (3), two or more candidates have been credited with the same value and stand lowest on the poll, the candidate for whom the lowest number of origi nal votes are recorded shall be excluded, and if this number also is the same in the case of two or more candidates the returning officer shall decide by lot which of them shall be excluded".
Sub rule (4) indicates that if when a candidate has to be excluded two or more candidates have been credited with the same value, and stand lowest on the poll the candidate for whom the lowest number of original votes are recorded shall be excluded.
In the present case at the first count Principal, Kulkarni was excluded because he received the lowest number of votes on the first count.
At the second count Dr. Apte and Principal Sum were the two continuing candidates.
Of these two one had to be excluded.
Therefore the principle of exclusion is that the candidate for whom, the lowest number of original votes are recorded shall be excluded.
The original first preference votes indicated that Dr. Apte.
603 had 58 votes and Principal Suru had 53 votes.
Therefore.
Dr. Apte had larger first preference votes.
The other part of sub rule (4) of rule 75 is that if both at the first count and at the second count they had equal number of votes then one of them was to be excluded on the principle of decision by lot.
Rule 6 in the Schedule to the Presidential and Vice Presi dential Elections Rules, 1952 on which counsel for the appellants relied embodied the same principle which is as follows : "If, when a candidate has to be excluded under clause (a) above, two or more candidates have been credited with the same number of votes and stand lowest on the poll, exclude that candidate who had secured the lowest number of first preference votes, and if that number also was the same in the case of two or more candidates, decide by lot which of them shall be excluded".
Statute No. 158(3) on which counsel for the appellants relied is as follows : "If, when a candidate has to be excluded, two or more candidates have each the same number of votes, and are lowest on the poll, the candidate with the lowest number of votes at the first count at which the candidates in question have an unequal number of votes shall be excluded and, when the number of votes credited to the candidates are equal at all counts, the Registrar shall determine by lot who shall be excluded".
These provisions were referred to and relied on by counsel for the appellants only for the limited purpose of establishing that where two continuing candidates at the second count have equal number of votes in the second count and there is one vacancy to be filled up the candidate who had the lower number of votes at the first count shall be excluded.
The High Court held that the words "two or more candidates" and the other words "stand lowest on the poll" in rule 75(4) of the Conduct of Elections Rules indicated that the principle embodied in that rule would apply only where the contest continued between three and more continuing candidates and the question could not arise when the contest was only between two candidates left over as continuing candidates.
The other reason given by the High Court was that when there were two continuing candidates they could never stand lowest on the poll and the two candidates, according to the High Court, could stand lowest on the poll 604 only if there were other remaining or continuing candidates with larger and better value of votes.
The interpretation of rule 75(4) by the High Court is erroneous.
The rule itself speaks of two or more candidates and does not speak of more than two candidates as the High Court construed it.
The words "stand lowest on the poll" occur along with two or more candidates who have been credited with the same value.
It is because they have the .same value that both of them stand lowest on the poll.
There fore, rule 75(4) resolves that tie by adopting the principle of exclusion of one of the candidates with regard to the number of original votes at the first count.
The High Court held that the principle in rule 75(4) would not apply in the present case with only two continuing candidates for filling in one vacancy because there would be no possibility of transfer of the excluded candidate 's votes in favour of the other candidate.
The High Court therefore relied on rule 81(3) of the Conduct of Elections Rules, 1961 to support the conclusion that the only system of exclusion in a case of the present type would be decision by lot.
Rule 81(3) is as follows: "When at the end of any count only one vacancy remains unfilled and there are only two continuing candidates and each of them has the same value of votes and no surplus remains capable of transfer, the returning officer shall decide by lot which of them shall be excluded; and after excluding him in the manner aforesaid, declare the other candidate to be elected".
The High Court overlooked the rational of the principle embodied in rule 75(4) that in the case of two continuing candidates each having the same value of votes to fill in one vacancy the tie between the two would be solved by having regard to their original votes in the first count.
There would be no occasion for transfer of excluded candidate 's votes in such a contingency.
Where two or more candidates continued for one vacancy and each of the candidates would have the same value of votes at the end of a count the tie between the two or more candidates having equality of votes would be solved by excluding the one who had the lowest number of votes on the first count and thereafter the excluded candidate 's second choice would be transferred to the continuing candidates until the vacancy would be filled up by the principle of exclusion embodied in rule 75(4).
The principle in rule 81(3) is applicable where more than one seat is to be filled and only one vacancy remains unfilled with only two continuing candidates and each of them has the same 605 value of votes at that count.
In such a case the exclusion of one of the candidates is decision by lot.
The reason for decision by lot in rule 81(3) is that the two continuing candidates by reason of the transferred votes at the last count have the same value of votes.
The values of their votes in the previous counts have already been worked out by rule 80(7) of the Conduct of Elections Rules, 1961 which embodied the principle of exclusion of a candidate where two or more candidates have the same value of votes by having regard to the original votes of each candidate and excluding the candidate for whom fewest original votes are recorded.
The principle of Rule 81(3) does not apply to the present case because that rule applies to counting of votes where More than one seat is to be filled.
This is not the case here.
Rule 81(3) resolves tie on count of votes between the last two contesting candidates at the last count on transfer of votes from the previous count.
It is an established principle in the system of proportional representation by means of a single transferable vote by ballot that where for one vacancy there are three, candidates and one of them is excluded at the first count and the two candidates continued and in the second count both of them have equal number of votes then one of the two candidates who had the lower number of votes than the other continuing candidate in the first count shall be excluded.
The present election was held on this principle.
Section 56 of the Act only speaks of election by the system of proportional representation by means of a single transferable vote.
It cannot be said in the present case that there is any statutory infringement of election by the system of proportional representation by means of a single transferable vote.
The two rival contentions were that according to the University authorities Principal Suru was to be excluded at the second count because his votes on the original count were lower than that of Dr. Apte whereas according to the persons who impeached the election the only method of exclusion was decision by lot.
It appears that there is legislative sanction in support of the contention on behalf of the University authorities that resolving equality of votes by reference to first preference or original votes is a known recognised method in the system of proportional representation by means of a single transferable vote.
Even if Statute No. 158 of the Poona University does not in terms apply, Statute No. 158 furnishes a valuable guide regarding the working of the system of proportional representation mentioned in section 56 of the Act and principles analogous to Statute No. 158 are applicable and have been applied by the authorities who conducted the election in the present case.
Determination by lot in case of equality of votes in neither a principle of universal application nor is it a common law principle.
606 It is only permissible when there is a specific statutory provision to that effect.
In the absence of a statutory provision the method of decision by lot is not resorted to when there is other rational method.
The principle of decision by lot is dependent on chance and accident whereas the principle of exclusion with reference to difference of votes on the original count is based on reason and legislative principles.
In the present case the Statute imposed a duty of election by the system of proportional representation by means of a single transferable vote.
The principles of exclusion are not to be found in any statutory enactment in the present case.
On the one hand there is the support of legislative measures embodying the principle of exclusion by reference to original count.
The principle of exclusion by lot on the other hand is adhered to only if the Statute has a compelling force to that effect.
In the present case there is no such statutory compulsion of deciding by lot in the eventuality which happened.
If there are two principles of exclusion and the authority has a discretion in the mode of performing the duty, the authority cannot be commanded to a duty in a specific way (See Halsbury 's Laws of England, Third Edition, Vol.
II, Para.
160, page 85).
The election was held by the continuing Vice Chancellor.
The Court of the University was master of its own procedure.
It adopted one of the principles of exclusion by reference to votes on the original count.
In following that procedure it cannot be said that there is violation of statute.
It is not out of place to mention here that Principal Suru himself made a petition to the Chancellor under section 60 of the Act asking him not to confirm the election.
Under section 60 of the Act if any question arises as to whether a person has been duly elected or appointed the matter may be refer red on a petition to the Chancellor who shall decide the question and his decision shall be final.
We are not basing our decision on the finality of the decision of the Chancellor in the present case but this is a feature which is not to be lost sight of by reason of the fact that the candidate who lost at the election made representation for redress of his grievances to the Chancellor.
Counsel on behalf of the respondents repeated the contention which had been advanced in the High Court that Principals of 4 unaffiliated Colleges attended the Court meeting and therefore the election was bad.
The High Court rightly rejected that contention.
There is evidence to show that in the month of June, 1969 the Government sanctioned the recommendation of the University for affiliation of these Colleges to the University.
The affiliation was for three years from 1969.
In these orders it was stated that the final Government notification would be issued after the University submitted a report to the Government of fulfilling the conditions.
The respondents ' contention was that the notification was published after the month of May, 1970.
The High Court rightly held 607 that the sanction was granted by the Government.
Delayed publication of the notification would not detract from the sanction ,previously granted.
The third contention which had been urged in the High Court was not pressed here.
For these reasons, we accept the appeal and set aside the judgment of the High Court.
Each party will pay and bear its own costs in this Court.
V. P. section Appeal allowed.

dataset_name: IN-Abs

summary:
Under section 11 of the Poona University Act, 1948, the Vice Chancellor shall be elected by the Court of the University, from among three persons recommended by the Executive Council, and the election shall be made by the system of proportional representation by means of a single transferable vote by ballot.
In the present case, the result of the ballot papers was that one candidate secured 58 first preference votes, the second secured 53 first preference votes, and the third candidate secured 37 first preference votes.
The third candidate was eliminated on the first count on the basis of his securing the lowest number of first preference votes, and his second preference votes were distributed between the other two.
This resulted in both of them securing an equal number of votes on the second count.
and the candidate who had the majority in the first count was declared elected.
The election was set aside by the High Court.
On the questions: (1) Whether the tie should have been resolved by drawing of lots; and (2) Whether the principals of four colleges voted wrongly at the election because those colleges had not been duly affiliated at the date of election.
HELD: (1) It is an established principle in the system of proportional representation by means of a single transferable vote by ballot, that where for one vacancy there are three candidates and one of them is excluded at the first count and the other two candidates continue and secure in the second count an equal number of votes, then the one who had the lower number of votes in the first count shall be excluded.
Determination by lot in case of equality of votes is neither a principle of universal application nor is it a common law principle.
It is only permissible when there is a specific statutory provision to that effect.
In the absence of such a statutory provision the method of decision by lot is not resorted to when there is another rational method.
The principle of decision by lot is de pendent on chance and accident whereas the principle of exclusion with reference to difference of votes on the original count is based on reason and legislative principles.
The principles of exclusion are not to be found in any statutory enactment in the present case.
On the other hand there is the support of legislative measures embodying the principle of exclusion by reference to original count.
[605D, H; 606A C] (a) Rule 75(4) of the Conduct of Election Rules indicates that when two or more candidates have been credited with the same value and stand lowest on the poll the candidate for whom the lowest number of original 598 votes are recorded shall be excluded.
The rule applies when there are two or more candidates and not only when there are more than two candidates.
The words 'stand lowest on the poll ' qualify 'two or more candidates who have been credited with the same value '.
The High Court overlooked the rational of the principle embodied in this rule that in the case of two continuing candidates each having the same value of votes to fill in one vacancy the tie between the two would be resolved by having regard to their original votes in the first count.
[604B, F] (b) Rule 6 in the Schedule to the Presidential and Vice Presidential Election Rules, 1952, and Statute No. 158 framed under the Poona University Act, though it does not in terms apply to the election of a Vice Chancellor, also embody this principle.
[603B] (c) The High Court 's reliance on r. 81(13) of the Conduct of Election Rule, 1961, in support of the conclusion that the only system of exclusion in a case of the present type should be by lot is erroneous.
The principle in r. 81(3), applies only where more than one seat is to be filled and only one vacancy remains unfilled with only two continuing candidates and each of them has the same value of votes at that count.
[605C] (d) The defeated candidate himself made a petition to the Chancellor under section 60 of the Act, which provides that if any question arises as to whether a person has been duly elected the matter may be referred to the Chancellor whose decision shall be final, not to confirm the election.
The Court of the University has thus laid down its own procedure for correction.
When there is discretion to choose between two principles of exclusion, this Court would not command the University to exercise the discretion in a specific way.
[606E] (2) The four colleges were in fact affiliated before the date of election but there was delay in the publication of the notification.
Such delay would not detract from the sanction previously granted.
[607A]


judgement:
Appeal No. 1970 of 1969.
Appeal by special leave from the judgment and order dated January 21,1969 of the Allahabad High Court in exhibit Second Appeal No. 270 of 1963.
The appellant appeared in person.
E.C. Agrawala, A. T. M. Sampath and section R. Agarwal,, for the respondent.
The Judgment of the Court was delivered by Vaidialingam J.
The appellant in this appeal, by special leave, has argued his case in person and attacks the judgment of the Allahabad High Court dated January 21, 1969 reversing the decrees of the two Subordinate Courts.
The facts leading upto this appeal may be briefly stated : The respondent, who is the landlord, under whom the appellant is a tenant, obtained an exparte decree on March 9, 1957 in suit No. 74 of 1956 in the Court of the Additional Munsif, Kanpur.
The decree was not only for eviction, but also for payment of rent or damages and mesne profits, as well as costs.
The appellant pleaded that there was a compromise entered into between him and the respondent in and by which the manner of extinguishment of the decree was arrived at.
That compromise, according to the appellant, was entered into on July 25, 1957.
The terms of the compromise have been incorporated in ,the judgment of the Additional District Judge dated March 27, 838 1961 in Misc.
Civil Appeal No. 688 of 1960 and in other proceedings, and it is unnecessary for us to refer to them.
It is enough to note that if the amounts agreed to be paid as per its terms were paid the decree for eviction would stand extinguished retrospectively.
The plea of the appellant was that he has made the payments in accordance with the compromise and the last of such payments was on June 16, 1960.
As noted earlier, according to him, the date of the compromise was July 25, 1957.
It was his claim that when the last payment was made, the decree for eviction obtained against him on March 9, 1957 stood extinguished and that the landlord respondent has no further right to execute the decree.
The landlord had filed an application on July 19, 1960 for executing the decree in Suit No. 74 of 1956.
Prior to that, the appellant appears to have taken certain proceedings and asked for stay of execution till the disposal of some criminal case an also for adjustment of payments.
We are more particularly concerned with the application filed by the appellant on September 3, 1960, before the trial court.
That application was under Order XXI Rule 2(2) C.P.C.
In that application, the appellant, after referring to the compromise and the various payments, claimed to have been made by him under the compromise, prayed for recording an adjustment of the decree.
This application was opposed by the respondent on three grounds : (a) There has been no compromise, (b) There has been no payment, and (c) The application under Order XXI Rule 2 is barred by limitation, as it has been filed beyond 90 days from July 25, 1957.
The contentions of the landlord respondent were accepted by the trial court, which by its order dated October 8, 1960, dismissed the application filed by the appellant under Order XXI Rule 2, on the ground that the application having been filed beyond 90 days from ' July 25, 1957 was barred by limitation.
It is the view of the learned Munsif that as the case of the appellant was that the compromise was entered into on July 25, 1957, the period of limitation for filing an application for recording adjustment of the decree will start from that date.
The application filed by the appellant was dismissed on this sole ground without inves tigation into the truth of the compromise and the payments.
The appellant carried the matter before the learned Additional District Judge, Kanpur in Misc.
Civil Appeal No. 688 of 1960.
Before the learned District Judge, the appellant raised the contention that the view of the trial court that the period of limitation starts from July 25, 1957 is erroneous.
He pleaded that as the decree obtained by the landlord will get extinguished only when 839 the last payment was made, namely, on June 16, 1960, the period of limitation of 90 days for filing the application for recording adjustment of the decree will have to be computed from that date.
As the application has been filed within 90 days from June 16, 1960, the executing court has acted erroneously and illegally in rejecting his application as being barred.
The appellant had also raised contentions on facts regarding the truth of the compromise, as well as the payments claimed to have been made by him.
These contentions of the appellant, as seen from the judgment, were very strenuously contested by the respondent who pleaded that the application filed under Order XXI Rule 2 was barred, as correctly held by the executing court on the basis that the limitation starts from July 25, 1957.
The respondent pleaded that the appellant had sufficient opportunity to lead evidence both regarding the truth about the factum of compromise as well as regarding the payments claimed to have been made by him.
As this opportunity was not availed of by the appellant, the landlord pleaded that the appeal should be dismissed.
The learned District Judge by his judgment and order dated March 27, 1961, after referring to the contentions of the parties, as well as the terms of the compromise pleaded by the appellant, considered the main question as to from what date the period of limitation is 'to be computed.
The learned Judge before whom case law was cited on both sides with regard to the starting point for limitation, ultimately accepted the contention of the appellant that if he is able to establish that he has made the last payment, on June 16, 1960, the period of limitation of three months for filing an application under Order XXI Rule 2 would begin to run only from that date,, and that in that case, the application filed on September 3, 1960 will be in time.
The learned Judge categorically rejected the contention of the respondent decree holder supporting the view of the trial court that limitation has begun to run from July 25, 1957.
In fact the trial court could not have held otherwise, in view of the decision of the District Court in Misc.
Civil Appeal No. 688 of 1960.
After holding that the limitation will start only from June 16, 1960, the learned Judge, however, adverted to questions regarding the truth about the compromise as well as the payments claimed to have been made by the appellant.
But the court was faced with this difficulty, namely, that parties had not adduced evidence before the trial court as the latter had dismissed the application of the appellant on the ground that it was barred by limitation.
Therefore, the learned District Judge set aside the order of the trial court and remanded the proceedings for investigation into facts, namely, whether the compromise and the payments alleged 840 to have been made by the appellant on the basis of the com promise, particularly the payment stated to have been made on June 16, 1960 were true.
He gave a specific direction that if the payment on June 16, 1960 is found in favour of the judgment debtor the application filed by him is not barred by limitation It is significant that the respondent landlord never raised any objection to the maintainability of the appeal No. 688 of 1960.
Nor did he raise the contention that no investigation into the truth of the compromise or payments pleaded by the judgment debtor was needed as the payments claimed to have been made have not been certified and made in accordance with Order XXI Rule 1 C.P.C. as in force in Allahabad, nor on the ground that the application filed by the judgment debtor is barred by time.
No appeal was filed by the decree holder against the order of remand passed by the District Court.
After remand, both the parties adduced evidence with regard to these questions of fact before the trial court.
Even before the trial court the decree, holder did not contest its jurisdiction to investigate into facts.
In fact, he could not have raised any such contention, as the Munsif was bound by the remand order.
By judgment and order dated September 28, 1961, the learned Munsif accepted the plea of the appellant both regarding the truth of the compromise as well as the payments stated to have been made by him.
In particular, though there was a serious controversy between the parties regarding the payment stated to have been made by the appellant on June 16, 1960, the learned Munsif, on the evidence, accepted the appellant 's case and held in his favour on this point.
In view of this finding regarding payment on June 16, 1960, in favour of the judgment debtor, the period of limitation was computed by the Munsif from that date, as directed by the remand order of the District Judge, and held that the application filed by the judgment debtor was within time.
In this view, the learned Munsif ordered full adjustment and satisfaction of the decree as well as cost and further held that the decree got extin guished as pleaded by the judgment debtor.
The respondent filed an appeal before the 1st Additional Civil Judge challenging the judgment and order of the trial court dated September 28, 1961.
The learned Civil Judge by his judgment dated October 20, 1962, confirmed the findings of the trial court and dismissed the respondent 's appeal.
The respondent decree bolder filed Second Appeal No. 270 of 1963 before the High Court.
The learned Judge has not adverted to the proceedings referred to above leading up to the order of remand and the directions given in Misc.
Civil Appeal 841 No. 688 of 1960.
On the other hand, the learned Judge has proceeded on the basis as if the decision in this case was rendered for the first time by the Munsif on September 28, 1961, and by the Civil Judge on October 20, 1962.
In view of this, the. learned Judge merely noted that the two subordinate courts have concurrently accepted the case of the appellant, both on the question of compromise, as well as the payments claimed to have been made by him.
The learned Judge has also noted that the claim of the judgment debtor that he paid Rs. 235/ on June 16, 1960 has been concurrently accepted by both the courts.
After noting the above findings recorded concurrently by both the courts, the High Court does not express any disagreement with those findings.
But on the basis of those findings, the High Court considered the question whether, in the nature of the compromise pleaded by the appellant and found in his favour by the two courts, an application under Order 21 Rule 2 C.P.C. was maintainable.
In this connection the High Court referred to the provisions of Order 21 Rule 1 C.P.C. as amended and in force in Allahabad.
After quoting that rule, the High Court ' is of the view that as the appellant has not claimed to have made payments in compliance with those provisions, it was not open to him to ask for recording adjustment of the decree.
According to the High Court, his remedy, if any, is only by way of a separate suit for damages against the decree holder.
It is the further view of the High Court that this aspect has not been considered at all by the two courts and as such they committed an error in investigating the question regarding the truth or otherwise of the compromise or payments claimed to have been made in pursuance of the said compromise, particularly the payments made on June 16, 1960.
The High Court then refers to the stand taken by the decree holder that even on the basis of the compromise, the period of limitation for filing an application for recording adjust ment of the decree commences fro in July 25, 1957 as also the plea of the appellant that limitation commences from June 16, 1960, when the last payment was made, The High Court expressed the view that the agreement pleaded could amount to an adjustment of the decree only if the said agreement was in writing and had been tiled within the period allowed by the law of Limitation.
The High Court has not pursued the matter further and expressed an opinion as to what is the date from which the period of limitation is to be computed.
In the end the High Court expressed the view that the whole approach made by the two subordinate courts is erroneous, Obviously, this criticism must refer to the circumstances noted by the High Court that the payments under the, compromise. have not been claimed to have been made in the manner provided in Order 21 Rule 1 C.P.C. as in force in Allahabad.
On this reasoning the High Court reversed 842 appellant filed under Order 21 Rule 2 C.P.C.
It will be noted that even before the High Court the respondent had not taken any objection that the appeal filed by the judgment debtor namely, Misc.
Civil Appeal No. 688 of 1960 was not maintainable and that the findings recorded therein against are not binding on him: The appellant urged before us that the High Court was not justified in interfering with the concurrent findings on facts and that it committed an error in going behind the findings recorded in the Misc.
Civil Appeal No. 688 of 1960.
He further urged that the question as to from what date the period of limitation is to be computed has already been adjudicated upon in the said appeal, and that the decree holder should not have been permitted to raise over again the point concluded by the remand order.
The appellant also urged that the view of the High Court that the payments have not been made by him in accordance with Order 21 Rule 1 C.P.C. is not correct.
Mr. E. C. Agarwala, learned Counsel for the respondent decree holder has drawn our attention to Order 21 Rule 1 C.P.C. as in force in Allahabad.
He contended that even according to the appellant the payments have not been made in accordance with the said rule.
Therefore, he urged that the High Court was perfectly justified in holding that the payments which have not been made in accordance with the said rule, cannot be taken into account for recording adjustment of the decree.
In the view that we take that because of the decision in Misc.
Civil Appeal No. 688 of 1960 it is not open to the respondent to raise the objection either of limitation on or that the payments have not been made as per the said rule, we express no opinion whether the payments made directly to the decree holder under the specific terms of an agreement or a compromise cannot be pleaded in an application filed for recording satisfaction or adjustment and whether under those circumstances such payment should also be made in the manner provided in the said rule.
One aspect which strikes us and which will conclude the case against the respondent is the finding recorded by the learned District Judge on March 27, 1961 in Misc.
Civil Appeal No. 688 of 1960.
We have already referred to the nature of the findings recorded therein.
The executing court had dismissed the application filed by the appellant on the ground that it is barred by limitation as it has been filed beyond 90 days.
from July 25, 1957.
Before the District Judge parties were at issue on this aspect.
While according to the appellant, limitation starts only from 843 June 16, 1960, the respondent 's plea was that limitation commences from July 25, 1957 Various decisions were cited by both the parties before the District Court.
After a consideration of those decisions, the District Court specifically held that if the appellant is able to establish the compromise as well as the further fact that he paid the last instalment on June 16, 1960, his application is not barred by limitation as it has been filed within 90 days, namely on September 3, 1960.
Though the respondent pleaded that the appellant had an opportunity to let in evidence regarding the truth of the compromise as well as the payments claimed to have been made by him, the District Court took the view that the learned Munsif had no occasion to consider these aspects as he dismissed the application filed 'by the appellant on the sole ground of limitation.
After specifically recording the date from which period of limitation is to be computed, the learned District Judge remanded the proceedings to the trial court for investigation into the truth of the compromise as well as the. payments claimed to have been made by the appellant.
The District Munsif, after remand has elaborately gone into the matter and specifically found on fact in favour of the appellant, both regarding the truth of the compromise and the payments.
He also held that the last payment has been made on June 16, 1960, and, therefore, in view of the directions contained in the remand order, the application filed by the appellant was within time.
It is against this order of the District Munsif that the respondent filed an appeal before the District Court and a further Second Appeal before the High Court.
We have already stated that the respondent had filed on July 19, 1960 an application for executing the exparte decree.
It is in answer to that execution petition that the appellant filed objections by initiating proceedings under Order 21 Rule 2(2) C.P.C. on September 3, 1960.
Therefore, the. parties and the Courts had proceeded on the basis that the entire question related to a controversy in respect of execution, discharge or satisfaction of the decree.
Under section 47(2) C.P.C. the Court has power to treat the said proceeding as a suit.
That explains why the respondent did not raise any objection before the District Court that Misc.
Civil Appeal No. 688 of 1960 filed by the appellant was not maintainable.
We have already pointed out that before the District Court 'the respondent did not also raise any objection that no investigation regarding the truth of the compromise and the payment is necessary as the amount, even according to the appellant, has been paid contrary to Order 21 Rule 1 C.P.C. as in force in Allahabad.
In View of the circumstances pointed out above, in our opinion, the decision of the Additional District Judge in Misc.
844 Civil Appeal No. 688 of 1960 precludes the respondent from reagitating the point covered by that decision.
Mr. Agarwala pointed out that Misc.
Civil Appeal No. 688 of 1960 was not maintainable.
We are not impressed with this contention because apart from the fact that no such objection was raised before the District Court, which was dealing with the said appeal, the respondent himself has filed the appeal and the Second Appeal against the order passed by the District Munsif after remand.
It was against the original order of the District Munsif that the appeal was filed by the appellant before the District Court.
Even otherwise, as We have already pointed out, the proceed ings have been treated 'as one under section 47 C.P.C. in which the Misc.
Civil Appeal No. 688 of 1960 was perfectly competent.
Under Order 41 Rule 23, an appellant court has got power to remand the proceedings when a suit has been disposed of on a preliminary point.
We have already pointed out that the District Munsif dismissed the application filed by the appellant on the preliminary ground that it is barred by limitation.
We have already further pointed out that it must be considered to be a proceeding under section 47 as it was really in opposition to the execution proceedings filed by the respondent.
The appellate court, under those circumstances, when it disagreed with the trial court on the question of limitation was perfectly competent to remand the proceedings.
Under Order 43 Rule 1 Cl.(u) C.P.C. an appeal lies against an order remanding a case where an appeal would lie from the decree of the appellate court.
From the fact that the respondent has filed Second Appeal, which is the subject of attack before us against the decision in an appeal of the District Court in the same proceedings, it is clear that the respondent should have filed an appeal against the order of remand.
The consequence of an omission to file an appeal against the order of remand, under such circumstances, is indicated in section 105.
sub section
(2) C.P.C. which is as follows : "Sec.
105(2) Notwithstanding anything contained in sub section (1), where any party aggrieved by an order of remand made after the commencement of this Code from which an appeal lies does not appeal therefrom, he shall thereafter be precluded from disputing its correctness.
" We have already pointed out that the respondent had a right of appeal against the judgment and order passed in Misc.
Civil Appeal No. 688 of 1960.
The respondent admittedly did not file an appeal against the said order of remand.
If so, it follows 845 that the decision in Misc.
Civil Appeal No. 688 of 1960 regarding the date from which the period of limitation is to commence, namely, June 16, 1960, if payment on that date is established by the appellant binds both the parties, as that decision has become final.
It is on the basis of that decision that the trial court went into the facts and held in favour of the appellant.
Those findings have been confirmed by the District Court on October 20, 1962.
It was against the fresh decision given by the District Munsif on September 28, 1961 and confirmed by the District Court on December 20, 1962 that the present Second Appeal was filed before the High Court by the respondent.
The High Court when dealing with the matter should have given due effect to the decision given in the order of remand in Misc.
Civil Appeal No. 688 of 1960 and should have held that the respondent is precluded from raising either the plea of limitation or that it was not open to the appellant to rely upon the payments hot made in accordance with Order 21 Rule 1 C.P.C. as in.
force in Allahabad.
The High Court has committed a very serious error in law in not adverting to the remand order as well as to the various other circumstances We have already pointed out that the High Court has not differed from the concurrent findings recorded on facts in favour of the appellant.
The interference by the High Court with the decision of the two subordinate courts is erroneous in law.
In the result, the decree and judgment of the High Court dated January 21, 1969 in Second Appeal No. 270 of 1963 are set aside and this appeal is allowed.
There will be no order as to costs.
V.P.S. Appeal allowed.

summary:
The respondent, who was the landlord under whom the appellant was a tenant, obtained a decree for eviction and damages against the appellant.
The respondent filed an execution application on July 19, 1960.
In answer to it the appellant flied objections by initiating proceedings under O. 21, r. 2(2) C.P.C. on September 3, 1960.
In that application, the appellant alleged that there was a compromise between the parties on July 25, 1957 that in pursuance of the compromise he made various payments and that the last of the payments was made on June 16, 1960, and prayed for recording an adjustment of the decree.
The trial court, however, held that as the compromise was entered into on July 25, 1957 the period of limitation for filing the application would start from that date, and since the application was filed beyond 90 days from that date, it was barred by limitation.
The trial court dismissed the application on that sole ground, without investigating into the truth of the compromise or the payments.
On appeal, the appellate court accepted the contention of the appellant that if he was able to establish that be bad made the last payment on June 16, 1960 the period of limitation of three months for filing an application under O. 21, r. 2 would begin to run only from that date and that his application would be in time.
The appellate court therefore set aside the order of the trial court and remanded the proceedings for investigation into facts, namely, whether the compromise and the payments alleged to have been made by the appellant on the basis of the compromise and particularly the payment said to have been made on June 16, 1960, were true.
After remand, the trial court accepted the plea of the appellant regarding the truth of the compromise as well as the payments said to have been made by him, including the payment of June 16, 1960, held that the application filed was within time, and ordered 'full adjustment and satisfaction of the decree.
On appeal, the findings of the trial court were confirmed and the anneal was dismissed, in second appeal, the High Court accepted the findings on the questions of compromise and payments but held that as the appellant had not claimed to have made the payments in compliance with O. 21, r. 1, C.P.C., as amended and in force in Allahabad, it was not open to the appellant to ask for recording adjustment of the decree, and dismissed the application of the appellant filed under O. 21, r. 2.
Allowing the appeal to this Court, HELD: In view of the decision of the appellate court when remanding the matter, it was not open to the respondent to raise the objection ,either of limitation or that the payments had not been made as per O. 21, T. 1, C.P.C. The parties and the courts had proceeded an the basis that 837 the entire question related to a controversy in respect of execution, discharge or satisfaction of the decree.
Under section 47(2) C.P.C., the Court has power to treat the said proceeding as a suit.
Under O. 41, r. 23, an appellant court has power to remand a proceeding when a suit has been disposed of on a preliminary point; and under O. 43, r. 1 (u) C.P.C. an appeal lies against an order remanding the case where an appeal would lie against the decree of the appellate court.
The respondent should have filed an appeal against the order of the remand, and the consequence of his omission to file such an appeal is that under section 105(2), C.P.C., the decision of the appellate court, while remanding the matter, regarding the date from which the period of limitation is to commence, namely June 16, 1960, if payment on that date was established by the appellant, was final and binding on the parties.
The High Court when dealing with the matter should have given due effect to the decision given in the order of remand and should have held that the respondent was precluded from raising either the plea of limitation or that it was not open to the appellant to rely upon the payments not made in accordance with O. 21, r. 1, C.P.C., as in force in Allahabad.
The High Court had not differed on the concurrent findings recorded on facts in favour of the appellant and therefore, interference with the decision of the two subordinate courts was erroneous in law.
[843 F G. 844 C H; 845 A E]


judgement:
Appeal No. 367 of 1969.
Appeal by special leave from the judgment and order dated October 28, 1968 of the Madhya Pradesh High Court in Misc.
Civil Case No. 188 of 1967.
I. N. Shroff, for the appellant.
The respondent did not appear.
The Judgment of the Court was delivered by Hegde, J.
This appeal by special leave arises from the deci sion of the Madhya Pradesh High Court in a reference under section 44 of the Madhya Pradesh Sales Tax Act, 1959.
The reference was made by the Board of Revenue.
After stating the case, the Board of Revenue referred the following question to the High Court for its opinion. "Whether on the facts and circumstances of the case the Commissioner of Sales Tax acted illegally in exercising his powers ' of revision under section 39(2) of the Madhya Pradesh General Sales Tax Act, 1958 in respect of the assessment order dated 28 12 1,961 which was passed in respect of the returns submitted on 30 1 1958 and 17 6 1958 and on the basis of the notice in form XI issued on 29 8 1961 ?" The High Court answered that question in the affirmative and in favour of the assessee.
Aggrieved by that order, the Commissioner of Sales Tax, Madhya Pradesh has come up in appeal to this Court.
The assessee, M/s. Amarnath Ajitkumar was a registered dealer under the Madhya Bharat Sales Tax Act, Samv. 2007.
For the period from July 1, 1957 to 31st March, 1958, the period with which we are concerned in this appeal, the assessee submitted its return for the second and third quarters on January 30 , 1958 and for the fourth quarter on 17th June 1958.
These returns were made under section 9(3) of the .
The sales tax concerned in the present case was that leviable under the .
But the procedure to by adopted in the matter of assessment and collect ion was that prescribed in the Madhya Bharat Sales Tax Act Samv.
The Madhya Bharat Act was repealed by the Madhya Pradesh General Sales Tax Act, 1959, which came into force on April 1, 1959.
Thereafter the Assistant Commissioner of Sales Tax, issued a notice in form XI of the Madhya Pradesh Sales Tax (Central) Rules, 1959 on August 29, 1961.
That Officer passed the assessment order on November 28, 1961.
On October 30, 830 1964, the Commissioner of Sales Tax initiated proceedings under section 39(2) of the M.P. Sales Tax Act, 1959 for revising the assessment made.
After notice to the dealer the Commissioner on April 15, 1965 revised the assessment and enchanced the same by a sum of Rs. 993.06 paise.
The assessee 's appeal to the Board of Revenue was dismissed on June 20, 1966.
Both before the Commissioner as well as the Board of Revenue, the assessee contended that as the assessment related to the period when Madhya Bharat Sales Tax Act, Samv.
2007 was in force, the revision of that assessment is governed by section 12(1) of that Act and not section 39(2) of the M.P. Act, 1959.
It was urged on its behalf that under the Madhya Bharat Act, the Commissioner could not have revised the order of assessment after the expiry of two years after the assessment was made.
Hence the Commissioner was not competent to revise the assessment.
The Commissioner as well as the Board of Revenue rejected that contention.
They came to the conclusion that it was open to the Commissioner to take action under S.39(2) of the M.P. General Sales Tax Act, 1959 in the matter of revising the assessment.
The High Court did not agree with that view.
It held that in view of section 52 of the 1959 Act, the governing provision in the matter of revising the assessment was section 12(1) of the Madhya Bharat Act.
The only question that we have to decide is whether in the facts and circumstances of the case, the Commissioner could have exercised his power under section 39(2) of the M.P. Sales Tax Act, 1959.
Section 12(1) of the Madhya Bharat Act provides "The, Commissioner may in his discretion at any time suo moto or being moved by the assessing authority, call for and examine the records of any proceedings under this Act and if he considers any order is illegal or improper or erroneous in so far as it is pre judicial to the interests of the revenue he may pass orders as he thinks fit : Provided that no order shall be passed prejudicial to a dealer without giving him an opportunity of hearing; Provided further that the Commissioner shall not revise an order which has been made more than two years previously." From the second proviso, it is clear that the Commissioner is precluded from revising an order which had been made more than two years previously.
That proviso did not lay down any rule of limitation.
But it took away the power of the Commissioner 831 to revise any assessment after the prescribed period.
Thereafter the assessment became final and conclusive as against the Department as well as the assessee, unless it was liable to be changed under some other provision of the Madhya Bharat Act.
Section 39(2) of the M.P. Sales Tax Act of 1959 says "The Commissioner may of his own motion or on information received call for and examine the record of any proceeding under this Act if he, considers that any order passed therein by any person appointed under section 3 to assist him is erroneous in so far as it is prejudicial to the interests of the revenue, he may after giving the dealer an opportunity of being heard and.
after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment; Provided that no proceedings shall be initiated under this sub section after the expiry of three years from the date of the order sought to be revised. .
The M.P. Sales Tax Act, 1959 which repealed the Madhya Bharat Act by section 52 therein provided the following repeal and saving provisions.
"52(1).
The Central Provinces and Berar Sales Tax Act, 1947, the Madhya Bharat Sales Tax Act, Samv.
2007, the Central Provinces and Berar Sales Tax Act, 1947 as extended to Vindhya Pradesh and Bhopal region and as in force in those regions immediately before the commencement of this Act and the Rajasthan Sales Tax Act, 1954, as in force in Sironj region, are hereby repealed : Provided that such repeal shall not affect the previous operation of the said Acts or any right, title, obligation or liability already acquired, accrued, or incurred thereunder, and subject thereto, anything done or any action taken (including any appointment, notification, notice, order, rule, form, regulation, certificate or licence) in the exercise of any power conferred by or under the said Acts shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken in the exercise of the powers conferred by or under this Act, as if this Act were in force on the date on which such thing was done or action was taken; and all arrears of taxes and other 832 amounts due, at the commencement of this Act may be recovered as if they had accrued under this Act.
" The High Court came to the conclusion that in view of the ,decisions of this Court in The Sales Tax Officer Circle 1, Jabalpur vs Hanuman Prasad(1) and The Swastik Oil Mills Ltd. vs H. B. Munshi, Dy.
Commissioner of Sales Tax, Bombay, (2) the Commissioner was incompetent to revise the order because of section 12(1) of the Madhya Bharat Act read with section 52(1) of the M.P. Sales Tax Act, 1959.
Hanuman Prasad 's case (supra) arose out of M.P. Sales Tax Act, 1959.
Therein in respect of a period governed by the Central Provinces and Berar Sales Tax Act, 1947, the assessee therein filed its return and a notice in form XII was issued to him on March 10, 1959.
The assessee 's turnover was assessed by an order dated May 23, 1959.
But in the meantime, M.P. Sales Tax Act, 1959 came into force on April 1, 1959.
The Commissioner sought to revise the order of assessment on the ground that a portion of assessee 's turnover had escaped assessment.
The question arose whether he had to exercise his powers within the time fixed by the Berar Sales Tax Act, 1947 or that fixed under M.P. Sales Tax Act, 1959.
The specific question that arose for decision in that case was whether the Commissioner 's power to revise had to be exercised in accordance with section 11A(1) of the Central Provinces and Berar Sales Tax Act, 1947, as contended by the assessee or under section 19(1) of the M.P. Sales Tax Act, 1959 as contended by the Department.
That question was examined by this Court from several angles.
One of the tests applied was what is the effect of section 52 of the M.P. Sales Tax Act, 1959.
Dealing with that aspect, this Court observed at p. 90 of the report "It was under section 52 of the new Act that the repealed Act was repealed, and that section itself, under the proviso laid down that such repeal shall not affect the previous operation of the said Act or any right, title, obligation or liability already acquired, accrued or incurred thereunder.
There was also the further addition that subject thereto, anything done or any action taken (including any appointment, notification, notice, order, rule, form, regulation, certificate or licence) in the exercise of any power conferred by or under the said Act, shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken in exercise of the powers conferred by or under this Act, as if this Act were in force on the date on view of this proviso it has to be held that when this new which such thing was done or action was taken.
In (1) 19 S.T.C. 87.
(2) 21 S.T.C. 383, 833 Act came into force on 1st April, 1959, all rights, title, obligation or liability already acquired, accrued or incurred under the repealed Act by the respondent remained unaffected and intact.
The rights and liabilities, which had been acquired or incurred under the repealed Act, included the right or liability to be assessed in accordance with the provisions of the repealed Act in respect of turnover of sales effected during the time when that Act was in force." Agreeing with the High Court this Court held in Hanuman Prasad 's(1) case that the Commissioner could not have revised the order of assessment after the period prescribed in the repealed Act.
One of the reasons given in support of that conclusion is that "the rights and liabilities, which had been acquired or incurred under the repealed Act, included the right or liability to be assessed in accordance with the provisions of the repealed Act, in respect of turnover of sales effected during the time when that Act was in force".
The expression assessment includes re assessment.
Swastik oil MillS(2) case is a converse case.
Therein the assessee was assessed to sales tax under the Bombay Sales Tax Act, 1946, for the periods 1st April 1948 to March 31, 1950 and April 1, 1950 to March 31, 1951.
On January 7, 1963, Deputy Commissioner initiated proceedings under section 31 of the Bombay Sales Tax Act, 1 1953 proposing to revise the order of the Assistant Collector of Sales Tax in so far as he had allowed deduction in respect of the entire goods despatched by the assessee to its branches 'in other states overlooking the provisions of proviso (b) to rule 1 (ii) under section 6 (3) of the Act of 1946 as amended in 1949.
The question was whether the Deputy Commissioner could take advantage of the longer period prescribed under the Bombay Sales Tax Act, 1946 or whether he was required to exercise his powers within the shorter period fixed under the 1953 Act.
Bombay High Court as well as this Court came to the conclusion by applying the provisions in section 7 of the Bombay General Clauses Act (1 of 1904) that the Deputy Commissioner was entitled to exercise his power of revision within the period prescribed under the repealed Act.
Section 7 of the Bombay General Clauses Act provides "where this Act or any Bombay Act or Maharashtra Act, made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not (c)affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed.
(1) 19 S.T.C. 87.
(2) 21 S.T.C. 383.
834 (e)affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act had not been passed" Dealing with the scope of those provisions this is what this Court observed : "Very clearly, the repeal of the Act of 1953 by the Act of 1959 did not affect the rights and liabilities of the assessee to tax under the Act of 1953 or the Act or 1946 in respect of the turnover which became liable to sales tax under the Act of 1946.
The effect of clause (e) of section 7 of the Bombay General Clauses Act further is that any legal proceeding in respect of levy, imposition or recovery of that tax is to continue and any fresh investigation, legal proceeding or remedy could be instituted as if there had been no repeal by the Act of 1959.
Consequently, the repeal of the Act of 1953 did not in any way affect the power of the Deputy Commissioner to institute proceedings for revision suo motu against the appellate order of the Assistant Collector which had been passed in exercise of his powers under the Act of 1946.
It is true, as urged by Mr. Desai in the alternative, that, in fact, the proceedings should have been taken not under section 31 of the Act of 1953, but under section 22 of the Act of 1946.
That is so, because, when the Act of 1946 was repealed by the Act of 1953, similar provisions were made in the Act of 1953 to continue in force the provisions of the Act of 1946 in respect of rights and liabilities which may have accrued or have been incurred under the Act of 1946.
Section 48(2) and section 49(1) clearly contained provisions indicating that, in respect of a liability to tax under the Act of 1946, the rights and liabilities of the assessee had to be determined in accordance with the provisions of the Act of 1946 and all legal proceedings or remedies in respect thereof had also to be taken under the same Act.
Consequently the Deputy Commissioner in seeking to exercise revisional powers against the order of the Assistant Collector passed under the Act of 1946, had to proceed under section 22 of the Act of 1946.
That, however, is not at all material, because the provisions of section 22 of the Act of 1946 are quite similar to those of section 31 835 of the Act of 1953.
The mere incorrect mention of section 31 of the Act of 1953 in the notice is immaterial.
The Deputy Commissioner has the jurisdiction and power to revise the order under section 22 of the Act of 1946 and, consequently the proceedings initiated by him are not without jurisdiction.
" Now coming back to section 52 of the M.P. Sales Act of 1959, the proviso to section 52(1) provides that the repeal of the Madhya Bharat Act shall not affect any right already acquired or accrued thereunder.
The question is whether the bar on the power of the Commissioner from exercising the powers under section 12(1) of the Madhya Bharat Act after the prescribed period did create a right in favour of the assessee ? The effect of that provision is that after the time prescribed in that provision, the Commissioner could not revise the order of assessment to the prejudice of the assessee.
Similarly he could not revise the order of assessment to the prejudice of the Revenue.
Section 12(1) conferred a right both on the assessee as well as on the Department to see that an order of assessment is not revised to their prejudice after a particular date.
We fail to see why section 12(1) of the Madhya Bharat Act should not be considered as conferring on the assessee a right to see that the assessment made against him is not altered to his prejudice after a particular date.
That is a valuable right.
The effect of section 52 (1) of M.P. Sales Tax Act, as seen earlier is that all assessments, which includes reassessments should be in accordance with the repealed Act.
The second part of that proviso says that subject to what has been provided in the first part of the proviso, anything done or any action taken including an order in the exercise of any of the powers conferred by or under the repealed Act, shall, in so far as it is not inconsistent with the provisions of the M.P. Sales Tax Act, 1959 be deemed to have been done in the exercise of powers conferred by or under that Act as if that Act were in force on the date on which such thing was done.
There is undoubtedly a conflict between section 12(1) of the Madhya Bharat Act and section 39(2) of the M.P. Sales Tax Act, 1959.
The former provision prohibits the Commissioner from revising an order which has been made more than two years previously and the latter provision permits him to revise the order till the expiry of three years from the date of the order sought to be revised.
Therefore the Revenue cannot call into aid the second part of the proviso.
The resulting position is that the governing provision would continue to be section 12(1) of the Madhya Bharat Act.
For the reasons mentioned above this appeal fails and the same is dismissed.
Respondent is ex parte.
No costs.
L 3 Sup C.I./72 2500 5 10 72 GIPF. 835 of the Act of 1953.
The mere incorrect mention of section 31 of the Act of 1953 in the notice is immaterial.
The Deputy Commissioner has the I jurisdiction and power to revise the order under section 22 of the Act of 1946 and, consequently the proceedings initiated by him are not without jurisdiction.
" Now coming back to section 52 of the M.P. Sales Act of 1959, the proviso to section 52(1) provides that the repeal of the Madhya Bharat Act shall not affect any right already acquired or accrued thereunder.
The question is whether the bar on the power of the Commissioner from exercising the powers under section 12(1) of the Madhya Bharat Act after the prescribed period did create a right in favour of the assessee ? The effect of that provision is that after the time prescribed in that provision, the Commissioner could not revise the order of assessment to the prejudice of the assessee.
Similarly he could not revise the order of assessment to the prejudice of the Revenue.
Section 12(1) conferred a right both on the assessee as well as on the Department to see that an order of assessment is not revised to their prejudice after a particular date.
We fail to see why section 12(1) of the Madhya Bharat Act should not, be considered as conferring on the assessee a right to see that the assessment made against him is, not altered to his prejudice after a particular date.
That is a valuable right.
The effect of section 52(1) of M.P. Sales Tax Act, as seen earlier is that all assessments, which includes reassessments should be in accordance with the repealed Act.
The second part of that proviso says that subject to what has been provided in the first part of the proviso, anything done or any action taken including an order in the exercise of any of the powers conferred by or under the repealed Act, shall, in so far as it is not inconsistent with the provisions of the M.P. Sales Tax Act, 1959 be deemed to have been done in the exercise of powers conferred by or under that Act as if that Act were in force on the date on which such thing was done.
There is undoubtedly a conflict between section 12(1) of the Madhya Bharat Act and section 39(2) of the M.P. Sales Tax Act, 1959.
The former provision prohibits the Commissioner from revising an order which has been made more than two years previously and the latter provision permits him to revise the order till the expiry of three years from the date of the order sought to 'be revised.
Therefore the Revenue cannot call into aid the second part of the proviso.
The resulting position is: that, the governing provision would continue to be section 12 (1) of the Madhya Bharat Act.
For the reasons mentioned above this appeal fails and the same is,dismissed.
Respondent is ex parte.
No costs.
V.P.S. Appeal dismissed .

summary:
Section 12(1) of the Madhya Bharat Sales Tax Act, Samv.
2007 prohibits the Commissioner of Sales tax from revising an order of assessment which had been made more than two years previously, while section 39(2), of the Madhya Pradesh, Sales Tax Act, 1959, which came into force on April 1, 1959 and which repealed the Madhya Bharat Act, permits the Commissioner to revise an order till the expiry of three years from the date of the order sought to be revised.
The assessee was a registered dealer under the Madhya Bharat Act.
For the period from July 1, 1957 to 31st March, 1958 he submitted returns.
The Assistant Commissioner of Sales Tax passed an assessment order on November 28, 1961.
On October 30, 1964, the Commissioner of Sales Tax initiated proceedings tinder section 39(2) of the Madhya Pradesh Act for revising the assessment made.
The assessee contended that as the assessment related to the period when the Madhya Bharat Act was in force the revision of the assessment was governed by section 12(1) of that Act, and therefore, the Commissioner could not have revised the order of assessment after the expiry of two years after the assessment was made.
The High Court, in reference, held that, in view of section 52 of the Madhya Pradesh Act, the governing provision was section 12(1) of the Madhya Bharat Act.
Dismissing the appeal to this Court, HELD:(1) The proviso to section 52(1) of the Madhya Pradesh Act, provides that the repeal of the Madhya Bharat Act shall not affect any right already acquired or accrued there.
The effect of section 12 ( 1 ) of the Madhya Bharat Act is that after the time prescribed in that provision the Commissioner could not revise the order of assessment either to the prejudice of the assessee or of the Revenue. 'Me section thus conferred a right both on the assessee as well as on the Department to see that an order of assessment is not revised to their prejudice after two years from the date of the assessment order.
Therefore, the effect of section 52(1) of the Madhya Pradesh At, is that all assessments which include reassessments, should be in accordance with the repealed Act.
[835 B E] Sales Tax Officer Circle I, Jabalpur vs Hanuman Prasad 19 S.T.C. 87 and Swastik Oil Mills Ltd. vs H. B. Munshi, Dy, Commissioner of Sales Tax, Bombay, 21 S.T.C. 383, followed.
(2)The second part of the proviso no doubt provides that any action taken under the repealed Act shall, in so 'far as it is not inconsistent with the provisions of the latter Act, be deemed to have been done under the latter Act.
But there is undoubtedly a conflict between section 12(1) of the Madhya Bharat Act and section 39(2) of ' the Madhya Pradesh Act.
Therefore, the Revenue cannot call in aid the second part of the proviso.
[835 E H] 829