REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(s). 10792-10794 OF 2011

THE STATE OF HARYANA AND OTHERS ….APPELLANT(S)

VERSUS

HINDUSTAN CONSTRUCTION  COMPANY LTD. ….RESPONDENT(S)

WITH

CIVIL APPEAL NO(s).10795 OF 2011  CIVIL APPEAL NO(s).10808 OF 2011  CIVIL APPEAL NO(s).10805 OF 2011  CIVIL APPEAL NO(s).10807 OF 2011  CIVIL APPEAL NO(s).10804 OF 2011  CIVIL APPEAL NO(s).10796 OF 2011  CIVIL APPEAL NO(s).10801-10802 OF 2011  CIVIL APPEAL NO(s).10815-10816 OF 2011  CIVIL APPEAL NO(s).10806 OF 2011  CIVIL APPEAL NO(s).10810 OF 2011  CIVIL APPEAL NO(s).10803 OF 2011  CIVIL APPEAL NO(s).10799 OF 2011  CIVIL APPEAL NO(s).10812 OF 2011  CIVIL APPEAL NO(s).10798 OF 2011  CIVIL APPEAL NO(s).10797 OF 2011  CIVIL APPEAL NO(s).10800 OF 2011  CIVIL APPEAL NO(s).10820 OF 2011  CIVIL APPEAL NO(s).10811 OF 2011  CIVIL APPEAL NO(s).10813 OF 2011  CIVIL APPEAL NO(s).10814 OF 2011  CIVIL APPEAL NO(s).10809 OF 2011  CIVIL APPEAL NO(s).10817-10818 OF 2011  CIVIL APPEAL NO(s).10824 OF 2011

1

CIVIL APPEAL NO(s).10830 OF 2011  CIVIL APPEAL NO(s).10829 OF 2011  CIVIL APPEAL NO(s).10828 OF 2011  CIVIL APPEAL NO(s).10826-10827 OF 2011  CIVIL APPEAL NO(s).10825 OF 2011  CIVIL APPEAL NO(s).10821-10823 OF 2011  CIVIL APPEAL NO(s).10831 OF 2011  CIVIL APPEAL NO(s).10837 OF 2011  CIVIL APPEAL NO(s).10833 OF 2011  CIVIL APPEAL NO(s).10832 OF 2011  CIVIL APPEAL NO(s).10834-10835 OF 2011  CIVIL APPEAL NO(s).10840-10841 OF 2011  CIVIL APPEAL NO(s).10838-10839 OF 2011

JUDGMENT

NAVIN SINHA, J.

The common question of law arising for consideration in

this  batch  of  appeals  is  whether  the  exercise  of  revisional

power under Section 40 of the Haryana General Sales Tax Act,

1973  (hereinafter  referred  to  as  ‘the  Act  of  1973’)  after  its

repeal on 1.4.2003, by the Haryana Value Added Tax, 2003

(hereinafter  referred to as ‘the Act of  2003’),  is  sustainable.

The  appeals  have,  therefore,  been  heard  together  and  are

being disposed by a common order.  

2

2. The facts, for better appreciation, shall be culled out from

Civil  Appeal  Nos.10792-10794  of  2011.  The  sales  tax

assessment  of  the  respondent,  for  the  assessment  year

1998-99, was completed and refund ordered on 12.05.2000,

under  the  Act  of  1973.   Subsequently,  the  former  Act  was

repealed  by  the  Act  of  2003 on 01.04.2003.  A  show cause

notice was issued to the respondent on 07.06.2004 regarding

the refund ordered earlier, in exercise of suo-moto revisional

powers under Section 40 of the Act of 1973. By order dated

12.07.2004, the respondent was held liable for recovery of Rs.

65,35,632/-.

3. The  order  for  recovery  having  been  challenged  by  the

respondent before the High Court, it was held that resort to

Section 40 of the Act of 1973, after coming into force of the

new Act on 01.04.2003 was unsustainable, as the repeal and

saving  clause  in  Section 61 of  the  Act  of  2003,  saved only

pending proceedings under the former.  Since there were no

proceedings  pending  against  the  respondent  under  the

repealed Act, on the relevant date, the proceedings thereunder

3

could not be sustained or justified by reference to Section 4 of

the Punjab General Clauses Act, 1898.

4. Sh. Manish Paliwal, learned counsel appearing on behalf

of  the  State  of  Haryana,  submitted  that  the  refund  having

been  wrongly  obtained,  resort  to  suo-moto  revision  under

Section 40 of the Act of 1973, exercised within the limitation of

five years, was justified.  The wrong benefit of refund clearly

fell within the meaning of the expression privilege, obligation

or liability acquired or incurred under the repealed Act, and

was  therefore  saved  by  Section  4  of  the  Punjab  General

Clauses Act, 1898.  Relying on  Raymond Ltd. and Anr. vs.

State  of  Chhattisgarh  &  Ors.,  (2007)  3  SCC  79,  it  was

contended that the revisional power conferred on the revenue

in a fiscal legislation should not be construed as a stand-alone

provision, but as a provision intended to enable the revisional

authority to ensure that the assessment had been carried out

in accordance with law.  The power vested in the revisional

authority to correct an error in assessment has a direct nexus

with the order of assessment giving finality to the order of the

4

assessing authority.  There is a corresponding obligation and

responsibility on the assessee also, and when it is found that

the assessment was otherwise then in accordance with law,

the power of the revisional authority cannot be restricted in

revenue and fiscal matters.

5. Reliance was further placed on  Swastik Oil Mills Ltd

vs.  H.B.  Munshi,  Deputy  Commissioner  of  Sales  Tax,

Bombay,  1968 (2)  SCR 492,  and  Gammon India  Ltd.  vs.

Special  Chief  Secretary  and Ors.,  (2006)  3  SCC 354,  in

support of the submission that resort to Section 40 of the Act

of  1973  was  saved  by  reason  of  Section  4  of  the  Punjab

General Clauses Act, 1898.  

6. Sh.  P.H.  Parekh,  learned Senior  Counsel  appearing on

behalf of the respondent, urged that the impugned order called

for no interference.  The repeal and saving clause in Section

61 of the Act of 2003 exclusively saved pending proceedings

only.   The  application  of  the  Punjab  General  Clauses  Act,

5

1898, therefore, stood excluded by the expression of a different

intention in the repealing Act.  The legislature subsequently

amended  Section  61  of  the  Act  of  2003,  suitably  on

02.04.2010.   

7. At the outset, it is appropriate to set out the unamended

and amended provisions of Section 61 of the Act of 2003 to

facilitate better appreciation of issues.

Section 61 of 2003 Act (Before Amendment)

Section 61 of 2003 Act (After Amendment)

(1) The Haryana General Sales Tax Act,  1973 (20  of  1973),  is  hereby repealed :

“(1) The Haryana General Sales Tax Act,  1973  (20  of  1973),  is  hereby repealed.

Provided  that  such  repeal  shall not-

(a)  affect  the  previous  operation of the Act so repealed or anything duly done or suffered thereunder; or

(b)  affect  any  right,  title, privilege,  obligation  or  liability acquired,  accrued  or  incurred under the said Act; or

(c)  affect  any  act  done  or  any action  taken  (including  any appointment,  notification, notice,  order,  rule,  form regulation,  certificate)  in  the

6

exercise  of  any  power  conferred by or under the said Act,

and  any  such  act  done  or  any action  taken  in  the  exercise  of the powers conferred by or under the said Act shall  be deemed to have been done or  taken in the exercise of the powers conferred by or under the said Act as if this Act were in force on the date on which  such  act  was  done  or action  taken;  and  all  arrears  of tax and other amount due at the commencement  of  this  Act  may be recovered as if  the same had accrued under this Act.”

(2)  Notwithstanding  anything contained in sub-section (1), -

(a)   any  application,  appeal, revision or other proceedings made or preferred to any authority under the  said  Act,  and  pending  at  the commencement  of  this  Act,  shall, after  such  commencement,  be transferred  to  and disposed  of  by the officer or authority who would have  had  jurisdiction  to  entertain such  application,  appeal,  revision or other proceedings under this Act as  if  it  had  been  in  force  on  the date  on  which  such  application, appeal,  revision  or  other proceedings  were  made  or preferred;

(2)  Notwithstanding  anything contained in sub-section (1), -

[(a) any application, appeal, revision or  other  proceedings  made  or preferred to any officer or authority under the said Act and pending at the  commencement  of  this  Act, shall, after such commencement, be transferred  to  and  disposed  of  by the officer  or  authority who would have  had  jurisdiction  to  entertain such application, appeal, revision or other proceedings under this Act as if the said Act had been in force on the date on which such application, appeal,  revision  or  other proceedings were made or preferred.

Notwithstanding anything to the contrary  contained  in  any judgment, decree or order of any court  or  other  authority,  where

7

no review, revision or corrective action  could  be  initiated  or finalized  in  respect  of  any assessment,  order,  proceeding under  the  said  Act  prior  to  or after  1st April,  2003,  because  of judgment or decree of any court or  Tribunal  and  the  said assessment or order passed under the said Act had attained finality, the  limitation  of  five  years  as specified under Section 40 of the said  Act  shall  be  deemed  to  be eight years;”

8. We  have  considered  the  respective  submissions.   A

simple  repeal  of  an Act  leaves  no room for  expression of  a

contrary opinion.  However, if the repeal is followed by a fresh

enactment  on  the  same  subject,  the  applicability  of  the

General  Clauses  Act  would  undoubtedly  require  an

examination of the language in the new enactment to see if it

expresses  a  different  intention  from  the  earlier  Act.  The

enquiry would necessitate an examination if the old rights and

liabilities are kept alive or whether the new Act manifests an

intention to do away with or destroy them.  If  the new Act

8

manifests a different intention, the application of the General

Clauses Act will stand excluded.  

9. There  were  no  proceedings  pending  against  the

respondent under the Act of 1973 when the new Act came into

force on 01.04.2003.  The suo-moto revisional  power under

Section 40 of  the  former Act  was exercised on 07.06.2004.

The repeal and saving clause in Section 61 of the Act of 2003,

saved only pending proceedings under the repealed Act.  The

intendment clearly was that matters which stood closed under

the Act of 1973 had to be given a quietus and could not be

reopened.  

10. The  assessment  under  the  Act  of  1973  having  been

completed  and  refund  ordered,  the  exercise  of  suo-moto

revisional powers under Section 40 of the same after repeal

was  clearly  unsustainable  in  view of  the  contrary  intention

expressed under Section 61 of the Act of  2003, saving only

pending proceedings.  Section 4 of the Punjab General Clauses

9

Act,  1858  will  have  no  application  in  view  of  the  contrary

intendment expressed in Section 61 of the repealing Act.  Had

a contrary intention not been expressed, the issues arising for

consideration  would  have  been  entirely  different.  The

observations  in  State of  Punjab vs.  Mohar Singh Pratap

Singh,  (1955) 1 SCR 893, as extracted below are considered

relevant:-

“8……….Whenever  there  is  a  repeal  of  an enactment, the consequences laid down in Section 6 of the General Clauses Act will follow unless, as the  section  itself  says,  a  different  intention appears.  In  the  case  of  a  simple  repeal  there  is scarcely  any  room  for  expression  of  a  contrary opinion. But when the repeal is followed by fresh legislation  on  the  same  subject  we  would undoubtedly have to look to the provisions of the new Act, but only for the purpose of determining whether they indicate a different intention. The line of  enquiry  would  be,  not  whether  the  new  Act expressly keeps alive old rights and liabilities but whether  it  manifests  an  intention  to  destroy them…..”  

The observations in Gammon India Ltd. (supra) at paragraph

73 are to the same effect.

10

11. The  legislature,  in  its  wisdom  having  noticed  the

limitation and constraints under Section 61 of the Act of 2003,

made necessary amendments to the same by Act No. 3 of 2010

on 02.04.2010.  Any interpretation saving the revisional power

under Section 40 of the Act of 1973, without any proceedings

pending on the  relevant  date,  by resort  to  Section 4 of  the

Punjab  General  Clause  Act,  1858  would  render  the

amendment redundant, and an exercise in futility, something

which  the  legislature  never  intended  to  do.  Such  an

incongruous  interpretation  leading  to  absurdity  has  to  be

avoided.  

12. In  Civil  Appeal  10840-10841  of  2011,  an  additional

ground has been urged that the power of review under Section

41 of  the  Act  of  1973  was  exercised  on  12.8.2003,  by  the

Deputy  Excise  and  Taxation  Officer,  to  review  an  order  of

assessment dated 4.3.2002.  Section 35 of the new Act vested

the power of review in the Tribunal exclusively.

11

13.  The legislative provisions being different in the precedents

cited on behalf of the appellants, the same have no relevance

to the issue in controversy.  The order of the High Court calls

for no interference.

14.  The appeals, for reasons discussed, lack merit and are

dismissed.

………………………………….J.  (Ranjan Gogoi)   

.……….………………………..J.    (Navin Sinha)   

New Delhi, September 15, 2017

12

13