# [1964] 1 S.C.R. 752

- **Citation:** [1964] 1 S.C.R. 752
- **Court:** Supreme Court of India
- **Decided:** 1964
- **Bench:** B. P. Sinjia, P. B. Gajendra.Gadiub, K. N. WANCHoo, M. Hidayatullah, J.C. Shah
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1964-1-s-c-r-752-2811
- **Pages:** 14

## Headnote

Civil Caurl-Jurisdi<tion-Exclusion of-" Any a•u•...,..lll
made under thi• Act" meaning of-Scope of-Madraa General
Salta Tax Act, 1939 (Mad. 9 of 1939), 1. 18-A.
The appellant filed a suit against the rc.pondent for a
decree for Rs. 8339/• on the ground that the said amount had
been illegally recovered from it under the Madras Gcnrral
Sales Tax Act, 1939, for the years 1952-54. The respondent
1 S.C.R.
SUPREME COURT REPORTS
753
resisted the claim on the ground that the suit was incompetent
under s. 18-A of the Act. On the merits, it was contended
that the transactions in regard to groundnuts on which sales tax
was levied and recovered from the appellant were transactions
of purchase and not of sale, and it was urged that the appellant
having voluntarily made the return and paid the truces, it was
itot open to it to contend that the transactions were not tax.able
under the Act. Besides it was argued that the appellant had
not preferred an appeal either to the Deputy Commissioner
of Commercial Taxes or to the Sales Tax Appellate Tribunal
against the assessments and hence the suit was not maintainable.
The suit was decreed by the trial court but the High Court
reversed that decision and dismissed the suit on the ground
that in view of the provisions of s. 18-A of the Act, the suit
was incompetent. Alternatively, it wa< found on merits that
the claim made by the appellant was not justified. The
appellant came to this Court by special leave.
Held, that s. 18-A excludes the jurisdiction of Civil
Courts to set aside or modify anv assessment made under the
Act. There is Il'> express provisi0n in the Act under which
the suit can be said to have been filed and it falls under the
prohibition contained in this section.
The prohibition is
express and unambiguous and no suit can he entertained by a
Civil Court, if by institutin~ the suit, the plaintiff wants to set
aside or modify any assessment ma.de under the Act.
Where
an order of assessment has been made by an appropriate
au~hority under the provisions of the Act, any cliallenge to
its cnrrcctness and any attempt either to have it set aside or
modified must be made before the appellate or revisional forum
prescribed by the relevant provisions of the Act. A suit instituted for that purpose is barred under s. 18-A.
When the appellant made its voluntary returns and paid
the tax in advanee to be adjusted at the end of the year from
time to time, it treated the ~roundnut transactions as taxable.
The appellant having conceded the taxable character of the
transactions in question, no ocrasion arose for the taxing'
authorities to consider whether the said transactions could be
taxed or not.
Even after the impugned orders of assessment
were made, the appellant did not choose to file an appeal and
ur~e before the appellate authority tha: the transactions were
sale transactions and as such were outside the purview of
s. SA (2). If an orde.r made by a taxing authority under the
relevant provisions of the Act in a case where the taxable
character of a transaction is dlqputed, is final and cannot be
challenged in a civil court by a separate suit, the position is just
1969
Firm and fUuri
Sulbayya Chltl.1 &
Sons •.
Thi Star1 of
Andhra Pradul>
1963
Firm a1llf flluri
Subb'!'Ya Clr<11y &
s..,
Tu Stull of
l.Jtdlwa Pi atJ.sla
754 SUPREME COURT REPORTS [1964] VOL.
the 5'mc whcrr thr taxable character of the transactions is not
even disputed by the dealer who accepts the order for the purp<>-
scs of the Act and then imtitutcs a suit to stt aside or modify it,
The exprrssion "any assessment made under this Act"
is wide enough to cover all assessments made by the appropriate authoritics under this Act whether the said asscssmcntJ
arc correct or nnt. It is the activity of the assessing otricer
acting as such officer which is intended to be projected and u
soon as it is shown that excrci'.'iing hio; jurisdiction and authority
under this Act, an as..,~sing officer has made an order of assessment, that clearly falls

## Text

1963
;i.11 of I? ajo.th m
y,
Sripof Jain
W4tt<hoo, J.
1963
, .,,,,.,, • 15.
752 SUPREME COURT REPORTS [1964] VOL.
case of this kind is given to the Minister-in-charge
under
r.
21.
The
definitions
therefore
of
"Government" and "the State Government" in the
Rajasthan General Clauses Act are of no help to the
respondent once it is held that r. 31 (vii) (a) of the
Business Rules when it speaks of "compulsory
retiring of any officer" refers only to compulsory
retirrment as a penalty under r. 14 of the Classifi·
cation Rules and not to the two other kinds of
retirement (namely, superannuation under r. 56 or
retirement under r. 244 (2) of the service Rules).
The appeal is therefore allowed and the ordrr
of the High Court srt aside. In the circumstancea
we pass no order as to costs.
Appeal allowed.
FIRM AND ILLURI SUBBAYYA CHETTY
AND SONS
ti.
THE STATE OF ANDHRA PRADESH
(B. P. SINJIA, c. J., P. B. GAJENDRA.GADIUB,
K. N. WANCHoo, M. HIDAYATULLAH and
J.C. SHAH, JJ.)
Civil Caurl-Jurisdi<tion-Exclusion of-" Any a•u•...,..lll
made under thi• Act" meaning of-Scope of-Madraa General
Salta Tax Act, 1939 (Mad. 9 of 1939), 1. 18-A.
The appellant filed a suit against the rc.pondent for a
decree for Rs. 8339/• on the ground that the said amount had
been illegally recovered from it under the Madras Gcnrral
Sales Tax Act, 1939, for the years 1952-54. The respondent
1 S.C.R.
SUPREME COURT REPORTS
753
resisted the claim on the ground that the suit was incompetent
under s. 18-A of the Act. On the merits, it was contended
that the transactions in regard to groundnuts on which sales tax
was levied and recovered from the appellant were transactions
of purchase and not of sale, and it was urged that the appellant
having voluntarily made the return and paid the truces, it was
itot open to it to contend that the transactions were not tax.able
under the Act. Besides it was argued that the appellant had
not preferred an appeal either to the Deputy Commissioner
of Commercial Taxes or to the Sales Tax Appellate Tribunal
against the assessments and hence the suit was not maintainable.
The suit was decreed by the trial court but the High Court
reversed that decision and dismissed the suit on the ground
that in view of the provisions of s. 18-A of the Act, the suit
was incompetent. Alternatively, it wa< found on merits that
the claim made by the appellant was not justified. The
appellant came to this Court by special leave.
Held, that s. 18-A excludes the jurisdiction of Civil
Courts to set aside or modify anv assessment made under the
Act. There is Il'> express provisi0n in the Act under which
the suit can be said to have been filed and it falls under the
prohibition contained in this section.
The prohibition is
express and unambiguous and no suit can he entertained by a
Civil Court, if by institutin~ the suit, the plaintiff wants to set
aside or modify any assessment ma.de under the Act.
Where
an order of assessment has been made by an appropriate
au~hority under the provisions of the Act, any cliallenge to
its cnrrcctness and any attempt either to have it set aside or
modified must be made before the appellate or revisional forum
prescribed by the relevant provisions of the Act. A suit instituted for that purpose is barred under s. 18-A.
When the appellant made its voluntary returns and paid
the tax in advanee to be adjusted at the end of the year from
time to time, it treated the ~roundnut transactions as taxable.
The appellant having conceded the taxable character of the
transactions in question, no ocrasion arose for the taxing'
authorities to consider whether the said transactions could be
taxed or not.
Even after the impugned orders of assessment
were made, the appellant did not choose to file an appeal and
ur~e before the appellate authority tha: the transactions were
sale transactions and as such were outside the purview of
s. SA (2). If an orde.r made by a taxing authority under the
relevant provisions of the Act in a case where the taxable
character of a transaction is dlqputed, is final and cannot be
challenged in a civil court by a separate suit, the position is just
1969
Firm and fUuri
Sulbayya Chltl.1 &
Sons •.
Thi Star1 of
Andhra Pradul>
1963
Firm a1llf flluri
Subb'!'Ya Clr<11y &
s..,
Tu Stull of
l.Jtdlwa Pi atJ.sla
754 SUPREME COURT REPORTS [1964] VOL.
the 5'mc whcrr thr taxable character of the transactions is not
even disputed by the dealer who accepts the order for the purp<>-
scs of the Act and then imtitutcs a suit to stt aside or modify it,
The exprrssion "any assessment made under this Act"
is wide enough to cover all assessments made by the appropriate authoritics under this Act whether the said asscssmcntJ
arc correct or nnt. It is the activity of the assessing otricer
acting as such officer which is intended to be projected and u
soon as it is shown that excrci'.'iing hio; jurisdiction and authority
under this Act, an as..,~sing officer has made an order of assessment, that clearly falls within the scope of s. 18-A.
The fact
that •he order pa~scd by the a•scssing authority may in fact be inco,.,..rt or wronK docs not affect the position that in law the said
order has been passed by an appropriate authority and the
as~essment made by it mu'lt he treatt>d as made under this Act.
Whether or not an a.~sessment has hccn made under this Act
will not depend on the cnrrf'ctness or accuracy of the order
passed by the assessing authority.
There is a gen.ral prcsumption that there must be a
remedy in 1he ordinary civil courts to a citizen claimin.rc that
an amount has been recovered f om him illegally and such
a remedy rould be held to be barred only on very clear and
uQmistakahle indications to the conirary. The exclusion of
jurisdiction of civil courts to entf"rtain civil causes will not be
assumed unless the relr.vant statute contains an express provision tfl the effr.ct or leads to a necessary and inevitable
implication of that nature. The mere fact that a
sper.ial
st;iture provi,tr.s for certain rcmedi~ m.!y not by itself necessarily
exclurle the jurisdiction of the civil courts to deal with a case
brou~ht before it in respect of sor11e of the matters covered by
the said statute.
There is no justification for the aot.sumption that if a
deci•ion has been made by a
taxin~ authority under the
provisions of a taxing statute, its valirlitv can be cha1lcnged by
a suit on the grnund that it is incorrect on merits and as such it
can be claimed that the provisions of the ~aid statute have
not been complied with. Non·compliance with the provisions
of the stature mu't be non.compliance with such fundamental
provisinns of the statute as would m<lkc the entire procee ..
dings brfore the appropriate authority illegal and without
j1~risdiction. If an appropriate authnrity ha5 acted in violation
of thf' fundamrntal principles of judicial prOCt"durc, that may
also tend to mlkc the proceedings illegal and void and that
intirmi1y may affcrt <he validity of the order passed by the
au:hority in question. It is case5 of this character where the
1 S.C.R.
SUPREME COURT REPORTS
755
defect or infirmity in the order goes to the root of the order
and makes it in law invalid and void that these observations
may perhaps be invoked in support of the plea that the civil
court can exercise its jurisdiction notwithstanding a provision
to the contrary cnntained in the relevant statute.
Secretary of State v. M1JBk .r, Oo., (1940) 67 I.A. 222 and
Reliegh Investmmt Oo. Ltd. v. Governor General in Oouncil,
(1947) 74 I.A. 50, relied on.
State of Andhra Pradesh v. Rri Kmhna Oownm Oo.
(1960) I Andhra W.R. 279, overruled.
CtvIL APPELLATE JURISDICTION : Civil Appeal
No. 315 of 1962.
Appeal by special leave
0
from the judgment
and order dated November 16, 1960 of the Andhra
Pradesh -High Court in A.S.No~ 397 of 1957.
A. Ranganadham Chetty, A. Vedavalli
and
A. V. Rangam, for the appellant.
D. Narasaraju, Advocate-General for the State
of Andhra Pradesh, T.V.R. Tatachari and P.D,
Menon, for the respondent.
1963. January 25. The Judgment of the Court
was delivered by
J96S
Firm and l/luri
Subboyya ci..11.1 I!!
Sons
••
1M Stat.if
Aodhro l'Taiksh
GAJENDRAGADKAR, J.-The short question
Cajmdr•gadfra•. J.
which arises in this appeal is whether the suit instituted
by the appellant, Firm of Illury Subbayya Chetty
& Sons, in the court of the Subordinate Judge at
Kurnool, seeking to recover Rs. 8,349/- from the
respondent, the State of Andhra Pradesh, on the
ground that the said amount had bren illegally
recovered from it under the l\1adras General Sales
. Tax Act, 1939 (Mad. IX of 1939) (hereinafter called
the Act) for the years 1952-54 is competent ornot ;
and this question has to be determined in the light ·
of the scope and effect of section 18-A of the Act.
196!
Firm and llluri
.I066'!7ya ~·"'''' &
Sou
v.
Tiu Sra11 of
bdh•a Pradull
756 SUPREME COURT REPORTS [1964] VOL.
The appellant is a firm of mi;rchants carrying
on commission agency and other business at Kurnool
and as such, it purchases and ~els ground-nuts and
other goods on behalf of principles for commission.
For the year l!J.~2-53 the Sales-tax authorities included
in the appellant's taxable turnover an amount of
Rs. 3,45,48'!/12/lO representing
groundnut
sales
and collected the tax on the total turnover from it
in September, 1953 when the amount of the said
tax was determined and duly adjusted. The said
turnover of Rs. 3,45,488/12/10 in fact represented
sall'S of groundnuts and not purchases and tax was
recovered from the appellant on the said amount
illegally inasmuch as it is only on purchase of
groundnuts that the tax is leviable. ru a result of
this
illegal levy, the
appellant had to pay
Rs. 5.398/4/3 for the said year. Similarly, for the
subsequent year. 1953-1954 the appellant had to pay
an illegal tax of Rs. l,159/ll/9. In its plaint, the
appellant claimed to recover this amount together
with interest@ It% per annum and that is how
the claim was valued at Rs. 8,349/-.
This claim was resisted by the respondent on
two grounds. It was urged that the suit was incompetent having rc.-gard to the provisions of s. 18-A of
the Act; and on the merits it was alleged that the
transactions in r, ~ard to groundnuts on which s let·
tax was levied and recovered from the appellant
were tran5actions of purchase and not of sale.
In
this connection, the respandent referred to the fact
that the appellant itself had included the transaction
in question in the return submitted by it in form A
and that it was making payments tentatively every
month to be adju~t~d after the final assessment was
made at the end of the year. Accordingly, the final
adjustment was made in September and the total
amount due from the appellant duly recovered. Thus,
the appellant h:iving voluntarily made the return
and paid the taxes, it was not open to him to
I
1 S.C.R.
SUPREME COURT REPORTS
757
contend that the transactions in regard to groundnuts
were not taxable under
the Act. Besides, the
appellant had not preferred an appeal either to the
Deputy Commissioner of Commercial faxes or to
the Sales Tax Appellate Tribunal ; and so, it had
not availed itself of remedies provided by the Act.
On these pleadings, the trial Court framed
three principal issues. The first issue was whether
the suit was barred bv s. 18-A of the Act; the second
was whether there had been excess collection of sales
tax for the two years in question and if so, how
much ? And the third issue was whether the appellant
was estopped from questioning the validity ot the
assessment ? According to the trial court, the respondent had failed to prove its pleas against the appella11t's claim and. so, it recorded findings in favour of
the appellant in all the three issues. In the result,
a decree followed in favour of the appellant for the
recovery of Rs. 6,558/- with interest @ 6% per
annum
from
November 12, 1955 till the date of
payment.
This decree was challenged by the respondent
by preferring an appeal before the High Court of
Andhra Pradesh. It appeared that the decision of
the said High Court in the case of State of Andhra
Pradesh v. Shri Krishna Cocoanut Co. (1 ), was in
favour of the view taken by the trial Court ; but the
respondent urged before the High Court that tqe said
decision was erroneous in , law and required reconsideration. That is why the respondent's appeal was
placed before a Full Bench of the High Court. The
Full Bench has upheld the contentions raised by the
respondent. It has held that in view of the provisions
of s. 18-A of the Act, the suit is incompetent.
Alternatively, it has found that cin the merits, the
claim made by the appellant was not justified. The
result of these findings was that the respondent's appeal
was allowed and the appellant's suit was dismissed
(I) (1960) I Andbra W.R. 279.
Firm and /lluri
Subbayya Chitty ti
s ....
"·
Th, Stal1 of
Andhra Prod.sh
196!1
Fimt at1d 111111i
SubHJ)'• C/tdlJ &
s..,
••
'1 Ill S1o11 ef
Aodkto P.od1Sli
Gajnub_,..., J.
758 SUPREME COURT REPORTS (1964] VOL.
with costs. The appellant had filed cross-objections
claiming additional interest on the decretal amount,
but since its suit was held to be incompetent by the
High Coun, its cross-objections failed and were
dismissed with costs. "It is against this decree that
the appellant has come to this Court by special leave.
Mr. Ranganathan Chctty for the appellant
contends that the High Coun was in error in coming
to the conclusion that the appellant's suit was incompetent because he argues that the High Court
has misjudged the effect of the provisions of s. 11!1-A.
In dealing with the question whether Civil Courts'
jurisdiction to entertain a suit is barred or not, it is
necessary to bear in mind the fact that there is a
general presumption that there must be a remedy
in the ordinary civil courts to a citizen claiming thiit
an amount has been recovered from him illegally
and that such a remedy can be held to be barred
only on very clear and unmistakable indications to
the contrary. The exclusion of the jurisdiction of
Civil Courts to entertain civil causes will not be
assumed unless the relevant statute contains an express
provision to that effect, or leads to a necessary and
inevitable implication of that nature. The mere
fact that a special statute provides for certain remedies may not by itself necessarily exclude the
jurisdiction of the civil courts to deal with a case
brought before it in respect of some of the matters
covered by the said statute.
·
It is, therefore, necessary to enquire whether
s. 18-A expressly or by necessary implication excludes the jurisdiction of the civil court to entertain
a suit like the present. Section 18-A provides that
no suit or other proceeding shall, except as expressly
provided in this Act. be instituted in any Court to
set. aside or modify any assessment made under this
Act.
It is common ground that th('re is no express
provision made in the Act under which the present
1 S.C.R.
SUPREME COURT REPORTS
759
suit can be said to have been filed, and so, it falls
under the prohibition contained in this section. The
prohibition is express and unambiguous and there
can be ne doubt on a fair construction of the section
that a suit cannot be entertained by a civil court if,
by instituting the suit, the plaintiff wants to set
a side or modify any assessment made under this Act.
There is therefore, no difficulty in holding that this
section excludes the jurisdiction of the civil courts
in respect of the suits covered by it. .
It is, however, urged by Mr. Chetty that if an
order of assessment has been made illegally by the
appropriate authority purporting to exercise its
powers under the Act, such an assessment cannot be
said to be an assessment made under this Act. He
contends that the words used are "any assessment
made under this Act'~ and the section docs not cover
cases of assessment which are purported to have been
made under this Act. In support of this argument
he has referred us to the provisions of s. 17 (1) and
s. 18 where any act done or purporting to be done
under this Act is referred to. It would, however, be
noticed that having regard to the subject-matter of
the provisions contained in ss. 17 ( l) and 18 it was
obviously necessary to refer not only to acts done,
but also to acts purporting to be done under this Act.
Section 17 ( l) is intended to bar certain proceedings and s. 18 is intended to afford an indemnity
and that is the reason why the legislature had to
adopt the usual formula by referring to acts done
or purporting to be done. It was wholly.unnecessary
to refer to cases of assessmenl purporting to have
been made under this Act while enacting s. 18-A,
because all assessments made under this Act would
attract the provisions of s. 18-A and that is all that
the legislature intends s. 18-A to cover.
The expression "any assessment made under
this Act" is, -in our opinion, wide enough to cover all
19'3
Firm and ll/uri
Subb•J!711 Chtl!JI fl
s ...
y,
711' Stat1 of
A.ndhra PtadJs!i
CajaidragaJkar, J.
196J
Fims and Jlluri
s"""·1JJ11 Chtuy <1
....,
••
Tli1 S141 .. f
AN/lira P, .itU1~
760 SUPREME COURT REPORTS [1964] VOL.
assessments made by the appropriate authorities
under this Act whether the said assessments arc
correct or not. It is the activity of the assessing
officer acting as such officer which is intended to be
protected and as soon as it is shown that exercising
his jurisdiction and authority under this Act, an
assessing officer has made an order of assessment that
clearly falls within the scope of s.IS·A. The fact
that the order passed by the assessing authority may
in fact be incorrect or wrong does not affect the
position that in law, the said order has been passed
by an appropriate authority and the assessment made
by it must be treated as made under this Act.
Whether or not a,1 assessment has been made under
this Act will not depend on the corrertness or the
accuracy of the order passed by the assessing authority.
In determining the applicability of s.18-A, the only
question to consider is: "ls the assessment sought co
be set aside or modified by the suit instituted an
assessment made under this Act or not?" It would be
extremely anomalous to hold that it is only an
accurate and correct order of assessment which falls
under s.18-A. Therefore, it seems to us that the orders
of assessment challenged by the appellant in its suit
fall under s.18-A.
In this connection, it is nccssary to emphasise
that while providing for a bar to suits in ordinary
civil courts in respect of matters covered by s. l 8-A,
the legislature has taken the precaution of safeguarding the citizens' rights by providing for adequate
alternative remedies. Section 11 of the Act provides
for appeals to such authority as may be prescribed;
s.12 confers revisional jurisdiction on the authorities
speci~ed by it; s.12-A allows an appeal to the
appellate Tribunal; s.l 2-B provides for a revision by
the High Court under the cases specified in it; s. l 2-C
provides for an appeal to the High Court; and s.12-D
lays down that petitions, applications and appeals
to High Court should be heard by a Bench of not
•
1 S.C.R.
SUPREME COURT REPORTS
761
less than two Judges. The matter can even be brought
to this Court by way of a petition under Art. 136
of the Constitution. It would thus be seen that any
dealer who is aggrieved by an order of assessment
passed in respect of his transactions, can avail himself of the remedies provided in that behalf by these
sections of the Act. It is in the light of these elaborate
alternative remedies provided by the Act that the
scope and effect of s.18-A must be judged. Thus
considered, there can be no doubt t,hat where an
order of assessment has been made by an appropriate
authority the provisions of this Act, any challenge
to its correctness and any attempt either to have it
set aside or modified must be made before the
appellate or the revisional forum prescribed by the
relevant provisions of the Act.
A suit instituted for
that purpose would be barred under s. 18-A.
The facts alleged by the appellant in this case
are somewhat unusual. The ·appellant itself made
voluntary returns under the relevant prov.isions of the
Act and included the groundnut transactions as
taxable transactions. It was never alleged by the
appellant that the said transactions were transactions
of sale and as such, not liable to be taxed under the
Act. It is true that under s.5A(2) groundnut is made
liable .to tax under s.3(1) only at the point of the
first purchase effected in the State by a dealer who is
not exempt from taxation under s. 3(3), but at the
rate of 2% on his turnover. When the appellant
made its voluntary returns and paid the tax in
advance to be adjusted at the end of the year from
time to time, it treated the groundnut transactions as
taxable under s.5A(2). In other words, the appellant
itself having conceded the taxable character of the
transactions in question, no occasion arose for the
taxing authority to consider whether the said transactions could be taxed or not; and even after th'!
impugned orders of assessment
were made, the
appellant did not choose to file an appeal and urge
1963
Firm and llluri
Subba_vya Clutty &
°"'
v.
1he State Df
Amlhra Pratksh
Gajmdragadkar, J.
1963
Fi"" and llt.ri
s~,. a..11.1 et
s....
••
Tlit Sto11 of
A•dllt• Prad11ll
Gajnubqttlk.r, J.
762 SUPREME COURT REPORTS [1964] VOL.
before the appellate authority that the transactions
were sale transactions and as such, were outside the
purview of s.5A(2). If the appellant had urged that
the said transactions were outside the purview of the
Act and the taxing authority in the first instance had
rejected that contention, there would be no doubt
that the decision of the taxing authority would be
final, subject, of course, to the appeals and revisions
provided for by the Act.
The position of the
appellant cannot be any better because it did not
raise any such contention in the assessment proceedings under the Act. If the order made by the taxing
authority under the relevant provisions nf the Act in
a case where the taxable character of the transaction
is disputed is final and cannot be challenged in a
civil court by a separate suit, the position would be
just the same where the taxable character of the
transaction is not even disputed by the dealer who
accepts the order for the purpose of the Act and then
institutes a suit to set it aside or to modify it.
The question about the exclusion of the jurisdiction of the civil courts to entertain civil actions by
virtue of specific provisions contained in special
statutes has been judicially considered on several
occasions. We may in this connection refer to two
decisions of the Privy Council. In Secretary of State
v. Mask. &: Coy., (1) the Privy Council was dealing
with the effect of the provisions contained in s. 188 ol
the Sea Customs Act (VIII of 1878). The relevant
portion of the said section provides that every order
passed in apral under this section shall, subject to
the power o revision conferred by s. 191, be final.
Dealing with the question about the effect of this
provision, the Privy Council observed that it is settled
law that the exclusion of the jurisdiction of the civil
courts is not to be readily inferred, but that such
exclusion must either be explicitly expressed or clearly implied.
Lord Thankerton who delivered the
opinion of the Board, however, proceeded to add that
(I) (19t0) 67 I.A. 222, J!6.
..
IS.C.R.
SUPREME COURT REPORTS
763
"it is also well-settled that that even if jurisdiction is.
so excluded, the civil
courts .have jurisdiction to_
examine into cases where the provisions of the Act
have not been complied with, or the statutory
tribunal has not acted in conformity with the funda·
mental principles of judicial procedure."
It is nece-_
ssary to add that these observations, though made in
·somewhat wide terms, do not justify the assumption
that if a decision has been made by a taxing authority under the provisions of the relevant taxing
statute, its validity can be challenged by a suit on
the ground that it is incorrect on the merits and as
such, it can be claimed that the provisions of the said
statute have not been complied with.
Non-compliance with the provisions of the statute to which
reference is made by the Privy Council must, we
think, be non-compliance with such fundamental
provisions of the statute as would make the entire
proceedings before the appropriate authority illegal
and without jurisdiction.
Similarly, if an appropriate authority has acted in violation of the fundamental principles of judicial procedure, that mav
also tend to make the proceedings illegal and void
and this infirmity may affect the validity of the order
passed by the authority in question. It is cases of
this character where the defect or the infirmity in the
order goes to the root of the order and makes it in
law invalid and void that these observations may
perhaps be invoked in support of the plea that the
civil court can exercise its jurisdiction notwithstanding a provision to the contrary contained in the relevant statute.
In what cases such a plea would
succeed it is unnecessary for us to decide in the present
appeal because we have no doubt that the contention of the appellant that on the merits, the decision
of the assessing authority was wrong, cannot be the
subject-matter of a suit because s. 18-A clearly bars
such a claim in the civil courts.
The next decision to which reference may be
made was pronounced by the Privy Council in the
1963
Firm and llluri
Subbay1a C~ll,J &
~ons
v.
1ht State of
Andhra Pradesh
Gajendragadlcar, J.
1963
Firm and lll11ri
Suh61l)'" Chi· t>' 8!
So"' .
••
T 11t Sta11 of
Andhra P1adull
764
SUPREME COURT REPORTS [1964] VOL.
case of Releigh I nve8tment Coy. Ltd. v. GoVt,rrwrGeneral in Council('). In that case the effect of s. 67 of
the Indian Income-tax Act fell to be considered. The
said section, inter alia, provides that no suit shall be
brought in any civil court to set aside or modify any
assessment made under this Act. lt would be noticed
that the words used in this section are exactly similar
to the words used in s. 18-A with which we are con·
cerned. In determining the effect of s. 67, the Privy
Council considered the scheme of the Act by parti ·
cular reference to the machinery provided by the Act
which enables an assessec effectively to raise in courts
the question whcth~r a particular provision of the
Income-tax Act bearing on the assessment made is or
is not ultra-vires. The presence of such machinery
observed the judgment, though by no means conclu·
~ive, marches with a construction of the section which
denies an alternative jurisdiction to enquire into the
same subject-matter. It is true that the judgment
shows that the Privy Council took the view that even
the constitutional validity of the taxing provision can
be challenged by adopting the procedure prescribed
by the Income-tax Act; and this assumption presum·
ably proceeded on the basis that if an asscssee wants
to challenge the vires of the taxing provision on
which an assessment is purported to be made against
him, it would be open to him to raise that point
before the taxing authority and take it for a decision
before the High Court under s. 66 ( 1) of the Act. It
is not necessary for us to consider whether this assum·
ption is well founded or not. But the presence of the
alternative machinery by way of appeals which a
particular statute provides to a party aggrieved by
the assessment order on the merits, is a relevant
consideration and that consideration is satisfied by
the Act with which we are concerned in the present
appeal.
·
The clause "assessment made under this Act"
which occurs in s. 18-A also occurs in s. 67 with
_(II (19t7) 741.A. 50, 68.
1 S.C.R.
SUPREME COURT REPORTS 765
whicn the Privy Council was concerned, and in
construing the said clause, the Privy Council observed
that "the phrase "made und~r this Act" describes the
provenance of the assessment : it does not relate to its
accuracy in point of law. The use of the machinery
provided by the Act, not the result of that use, is the
test."
These two Privy Council's decisions support
the conclusion that having regard to the scheme of
the Act, s. 18-A must be deemed to exclude the
jurisdiction of civil courts to entertain claim1 like the
present.
In the result, we must hold that the view taken
by the High Court is right and so, the appeal fails
and is dismissed. There would be no order as to
'°'''·
Appeal diamisaed.
KISHAN CHANDER
".
STATE OF MADHYA PRADESH
'
.
(P. B. GAJENDBA.GA.DKAB, K. N. WANCHOO,
M. HIDAYA.TULLA.H, K. C. DAB GUPTA and
J. C. SHAH, JJ.)
•
Ultra
Virea-Principle
of-001Mlitution
of Ind ·
Arla. 13, '19, 21,-The United State of Gwalior, Indore and
Malwa (Madhya Bharat) Gambling Act, samvat 2006 (Madhya
Bharat Act No. 61of1949), ss. 6, 8.
The three appcllanta with five others were tried for offenceo
under s. 4of the United State of Gwalior, Indore and Malwa
(Madhya Bharat) Gamblin~ Act and sentenced to imprisonment. The Scssioiu Judge rejected their ''""'lCals. The High
1913
Firm and llluri
Subbay_1a Chetty &
Sons
v.
I he State of
Andhra Pradesh
Gajtndr11gadkar1 J.
1963
January, 25.