CPC Case Brief – Dhulabhai v. The State of Madhya Pradesh (Civil Court Jurisdiction – Tribunal)

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Fact:-

The appellants are dealers in tobacco. They get their tobacco locally or import it from extra-state places. The former Madhya Bharat State enacted in 1950 the Madhya Bharat Sales Tax Act. Under §3 of the Act every dealer whose business in the previous year in respect of sales or supplies of goods exceeded in the case of an importer and manufacturer Rs. 5,000 and in other cases Rs. 12,000 had to pay tax in respect of sales or supplies of goods effected in Madhya Bharat. The government, in pursuance of this power, issued a number of notifications. All these notifications imposed tax at different rates on tobacco above described on the importer that is to say at the point of import. The tax was not levied on sale or purchase of tobacco of similar kind in Madhya Bharat. The tax was collected by the authorities in varying amounts from the appellants for different quarters. The appellants served notices under s. 80 of the Code of Civil Procedure and filed the present suits for refund of the tax on the ground that it was illegally collected from them being against the constitutional prohibition in Art. 301 and not saved under Art. 304(a) of the Constitution.

Holding:-

The court laid down various principle, they are:-

  • Where the statute gives finality to the orders of the special tribunals the Civil Court’s jurisdiction must be held to be excluded if there is adequate remedy to do what the Civil Courts would normally do in a suit.
  • Where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court.
  • The challenge to the provisions of the particular Act as ultra vires cannot be brought before Tribunals constituted under that Act.
  • When a provision is already declared unconstitutional or the constitutionality of any provision is to be challenged, a suit is open.

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