STATE OF HIMACHAL PRADESH AND OTHERSversusM/S A.J. INFRASTRUCTURES PVT. LTD AND ANR.

                           [2023] 4 S.C.R. 773                              773


        STATE OF HIMACHAL PRADESH AND OTHERS                                A
                                   v.
      M/S A.J. INFRASTRUCTURES PVT. LTD AND ANR.
                  (Civil Appeal No. 8980-8981/2012)
                           APRIL 28, 2023                                   B
     [S. RAVINDRA BHAT AND DIPANKAR DATTA, JJ.]
       Himachal Pradesh General Sales Tax Act, 1968– s.16-B–
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 – s.35–Held: s.16-B of
                                                                            C
the HPGST Act is not ultra vires any provision of law – It is a perfectly
valid piece of legislation and is not ultra vires the Constitution and/
or the Banking Companies Act as erroneously held in the decision
of the High Court impugned in CA No.9212 of 2012– Further, in
view of the decision in Central Bank of India case, any observation
in the decision impugned in CA No.8980 of 2012 touching upon                D
s.16-B of the HPGST Act vis-à-vis s.35 of the SARFAESI Act is of no
effect–Himachal Pradesh Land Revenue Act, 1954.
      Himachal Pradesh General Sales Tax Act, 1968– s.16-B –
“Tax to be first charge on property” – Himachal Pradesh Land
RevenueAct, 1954 – Chapter VI– Held: s.16-B would be attracted              E
only after determination of the liability and upon any sum becoming
due and payable; and it is only thereafter that the charge, if any,
would operate – In the present case, proceedings were not initiated
upon notice to the defaulters and the sum they owed to the department
had not been finally determined in accordance with law–Thus,
question of the State resorting to the provisions contained in Chapter      F
VI of the HPLR Act for recovering the dues, if at all, as arrears of
land revenue did not arise–Securitisation and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002.
       Practice and Procedure – Held: A decision on the
constitutional validity of a provision should be invited not in vacuum      G
but when the justice of the case demands such a decision – Decision
on an infructuous writ petition is inconsequential and can never be
of any effect.
      Code of Civil Procedure, 1908 – s.151 – Held: When the law
provides a specific remedy, it is not open to a party to take recourse      H
                                  773
774            SUPREME COURT REPORTS                       [2023] 4 S.C.R.


A     to s.151 – It preserves the inherent powers of the court to do justice
      in a case where the party has no other remedy under the CPC–
      Practice and Procedure.
            Disposing of the appeals, the Court
            HELD:1.1A law, which the State legislature had the
B     competence to enact, has been outlawed by the High Court while
      hearing a writ petition which was rendered infructuous due to
      developments subsequent to its filing and prior to its disposal
      but such developments had not been brought to the notice of the
      High Court. For all intents and purposes, the High Court by its
C     judgment and order dated 2nd January, 2008 decided an
      infructuous writ petition and, in the process, outlawed section
      16-B of the HPGST Act when the same was not at all warranted.It
      was also a clear but inadvertent error on the part of this Court to
      dismiss only the special leave petition against PNB as
      infructuous; the appropriate course for this Court ought to have
D     been to dismiss the writ petition of PNB itself as infructuous
      having regard to the clear stand taken by PNB in its aforesaid
      affidavit dated 30th September, 2010 that nothing survived for a
      decision on the writ petition on the date it was decided in view of
      release of the property from mortgage. In view of dismissal of
E     the special leave petition qua PNB by the order dated 8th April,
      2011, the judgment and order outlawing section 16-B of the
      HPGST Act can be examined.[Paras 29, 31 and 32][788-G-H; 789-
      E-G]
            A.R. Antulay vs. R.S. Nayak (1988) 2 SCC 602 : [1988]
F           1 Suppl. SCR 1– referred to.
             1.2 Since the writ petition had been rendered infructuous
      on the date it was decided, it was not necessary for the High
      Court to pronounce on the validity of section 16-B. A decision on
      the constitutional validity of a provision should be invited not in
      vacuum but when the justice of the case demands such a decision.
G
      Hence, it is held that the decision on an infructuous writ petition
      is inconsequential and can never be of any effect. The issue as to
      whether section 16-B of the HPGST Act is ultra vires any
      provision of law including the supreme law of the country is no
      longer res integra. What appears to be of significance in the light
H
         STATE OF HIMACHAL PRADESH v. M/S A.J.                         775
              INFRASTRUCTURES PVT. LTD

of the decision in Central Bank of India is that the findings in the   A
judgments and orders disposing of the writ petitions impugned
in two of the four civil appeals ~ the first dated 7th September,
2007 and the other dated 2nd January, 2008 ~ with regard to the
scope, ambit and applicability of section 35 of the SARFAESI
Act, more particularly the latter holding section 16-B of the
                                                                       B
HPGST Act as ultra vires the Constitution and the Banking
Companies Act, loses its basis and can no longer be held to be
legal and valid. Section 35 of the SARFAESI Act could not have
been construed as conferring any right on a secured creditor to
claim priority over dues of the State in the absence of a provision
in that behalf which presently can now be claimed, subject to other    C
conditions being fulfilled, in view of section 26E of the SARFAESI
Act. Pertinently, the High Court while seized of the writ petition
of PNB was not at all concerned with the SARFAESI Act as such.
The matter had travelled to the High Court from proceedings
under the DRT Act. There was, thus, no occasion for the High
                                                                       D
Court to pronounce on the validity of section 16-B of the HPGST
Act based on what was held by its coordinate Bench in M/s A.J.
Infrastructures Pvt. Ltd.. The High Courtwas therefore in clear
error.Section 16-B of the HPGST Act is a perfectly valid piece of
legislation and is not ultra vires the Constitution and/or the
Banking Companies Act as erroneously held in the decision of           E
the High Court dated 2nd January, 2008. Also, following the
decision in Central Bank of India, any observation in the decision
dated 7th September, 2007 touching upon section 16-B of the
HPGST Act vis-à-vis section 35 of the SARFAESI Act is of no
effect. [Paras35, 38-40][790-B-D; 793-C-H]
                                                                       F
      Central Bank of India vs. State of Kerala (2009) 4 SCC
      94 : [2009] 3 SCR 735 – relied on.
      M/s A.J. Infrastructures Pvt. Ltd. vs. State of H.P. and
      others CWP No. 306/2007 dated 7th September, 2007
      – referred to.
                                                                       G
      1.3 From the excerpt of the impugned judgment and order
of the High Court dated 2nd January, 2008 it is clear that
proceedings were not initiated upon notice to the defaulters and
the sum they owed to the department had not been finally
determined 28 in accordance with law. In view thereof, question
                                                                       H
776            SUPREME COURT REPORTS                        [2023] 4 S.C.R.


A     of the State resorting to the provisions contained in Chapter VI
      of the HPLR Act for recovering the dues, if at all, as arrears of
      land revenue did not arise.The State and its department either
      overlooked or were ignorant of the requirement of law that section
      16-B would be attracted only after determination of the liability
      and upon any sum becoming due and payable; and that, it is only
B
      thereafter that the charge, if any, would operate. No relevant
      documentary evidence having been placed before the High Court,
      when CWP 306 of 2007 was being heard, to indicate that necessary
      steps under the HPGST Act had been initiated by the State and
      its officers, the third issue has to be answered by holding that the
C     State not having taken steps as required by law for realization of
      its dues, there was no determination of liability, a fortiori, question
      of taking recourse to the HPLR Act for recovery of dues as arrears
      of land revenue did not arise. Without such determination of
      liability, no red entry marks could have been inserted in the
      revenue records and the High Court was right in holding that the
D
      State ought not to have refused mutation.The appellants (State
      and its officers) are not entitled to any relief except the declaration
      that section 16-B of the HPGST Act is not ultra vires any
      provision of law. In view of section 16-B having been outlawed
      by the High Court on 2nd January, 2008, this declaration shall
E     not enure to the benefit of the State in respect of cases that are
      old and have been closed but would be effective once again from
      this ay. [Paras 48, 49 and 51][795-F-G; 796-B-E; 797-C-D]
             State Bank of Bikaner & Jaipur vs. National Iron &
             Steel Rolling Corporation and Ors. (1995) 2 SCC 19 :
F            [1994] 6 Suppl. SCR 566 – referred to.
                               Case Law Reference
      [1994] 6 Suppl. SCR 566           referred to             Para 11
      [1988] 1 Suppl. SCR 1             referred to             Para 27
      [2009] 3 SCR 735                  relied on               Para 36
G            CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.8980-
      8981 of 2012.
             From the Judgment and Order dated 07.09.2007 of the High Court
      of Himachal Pradesh at Shimla in CWP No.306 of 2007 and CMP
      No.1160 of 2008.
H
              STATE OF HIMACHAL PRADESH v. M/S A.J.                           777
                   INFRASTRUCTURES PVT. LTD

          With                                                                A
          Civil Appeal Nos. 9212-9213 of 2012.
       Abhinav Mukerji, Bihu Sharma, Akshay C. Shrivastava, Ms.
Pratishtha Vij, Varinder Kumar Sharma, Advs. for the Appellants.
      A. Venayagam Balan, Sanjay Kapur, Ms. Megha Karnwal, Surya              B
Prakash, Arjun Bhatia, Ms. Astha Gumber, Advs. for the Respondents.
          The Judgment of the Court was delivered by
          DIPANKAR DATTA, J.
          Preface
                                                                              C
       1. A thin thread connects the two sets of civil appeals1, which
areat the instance of the State of Himachal Pradesh (for brevity, “the
State”, hereafter) and its officers.Since the provisions of law emerging
for consideration are almost the same in terms, though in different fact
situations, these appealswere heard one after the other andshall stand
                                                                              D
disposed of by this common judgment and order.
          Civil Appeal Nos.8980-8981/2012
        2. Civil Appeal No. 8980 of 2012 is directed against the judgment
and order of the High Court dated 7thSeptember, 2007 allowinga writ
petition2 presented before it by M/s. A.J. Infrastructures (Pvt.) Ltd., the   E
first respondent, on 6th March, 2007. The operative portion of the order
reads as follows:-
          “For all the aforesaid reasons, the writ petition is allowed.
          Order rejecting petitioner’s application for not mutating the
          entry in their name is quashed and set aside. The respondents       F
          no. 1 to 5 are directed to delete the adverse entry showing the
          sales tax dues of M/s Regent Rubber and M/s Eastman Rubber
          in relation to the property comprising in Khasra No. 254/2/1,
          Khatauni Nos. 7 Min, 14 Min, Measuring 3 Bighas 7 Bishwas,
          situated at Village Moginand, Kala-Amb, Tehsil Nahan, District
          Sirmour, HP and further respondent no. 3 is directed to mutate      G
          the property in the name of petitioner company. The petitioner
          shall be entitled to costs, which is quantified at Rs, 25,000/-
          from respondents no. 1 to 5.”
1
    Civil Appeal Nos. 8980-8981/2012 and Civil Appeal Nos. 9212-9213/2012
2
    CWP No. 306/2007                                                          H
778               SUPREME COURT REPORTS                        [2023] 4 S.C.R.


A            3. Aggrieved by the judgment and order dated 7th September, 2007,
      the official respondents in the writ petition applied for a review3.By an
      order dated 29th October, 2009, the High Court proceeded to dispose of
      the application for review by, inter alia, the following order:-
               “The present application of review has been filed after delay
B              of more than one year without proper and satisfactory
               explanation. No sufficient material has been placed on record
               for reviewing the order dated 07-09-07, which may be brought
               within four corners and provisions of Order 47 Rule 1 CPC,
               as observed in foregoing decisions. Therefore, only for taking
               different view, the said order dated 07-09-09 cannot be
C              reviewed. In these circumstances, the present application for
               reviewing the order dated 07-09-09 is dismissed on the ground
               of delay as well as on the merits.”
            The said order dated October 29, 2009 is challenged in C.A. No.
      8981 of 2012.
D
             4. The facts pleaded in the writ petition reveal that the first
      respondent had purchased the subject property (described in full in the
      operative part of the order dated 7th September, 2007, extracted above)
      in an auction conducted by the State Bank of Patiala (for brevity “State
      Bank”, hereafter) on 18th January, 2005 in exercise of power conferred
E     by the Securitisation and Reconstruction of Financial Assets and
      Enforcement of Security Interest Act, 2002 (for brevity, “the SARFAESI
      Act”, hereafter).The subject property was initially mortgaged on 11th
      October, 1999 with the Himachal Pradesh Financial Corporation (for
      brevity “HPFC”, hereafter) by M/s. Regent Rubber Private Limited
F     (for brevity “Regent”, hereafter). Due to breach committed by Regent,
      HPFC took over the property and sold it in an open auction to M/s
      Eastman Rubber (for brevity “Eastman”, hereafter). The subject property
      was thereafter mortgaged by Eastman with the State Bank. However,
      Eastman too having committed default in liquidating its dues, the subject
      property was eventually put up for sale in an open auction on 18th January,
G     2005 under rules 8 and 9 of the Security Interest (Enforcement) Rules,
      2002 (for brevity “SARFAESI Rules”, hereafter).
            5. The first respondent emerged as the highest bidder in the auction
      by quoting a sum of Rs. 50,01,000/-.Within the stipulated time, the first
      3
          CMP No. 1160/2008
H
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                    779
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

respondent paid the entire bid amount whereupon in accordance with               A
the provisions of rule 9(6) and (10) of the SARFAESI Rules, sale
certificate dated 21st July, 2005 was issued to the following effect:-
       “receipt of the sale price in full and handed over the delivery
       and possession of the scheduled property. The sale of the
       scheduled property was made free from all encumbrances                    B
       known to the secured creditor listed below on deposit of the
       money demanded by the undersigned.”
       6. After issuance of the sale certificate, the State Bank by its
letter dated 24th February, 2006 informed various authorities including
the taxation department of the State of sale of the subject property to          C
the first respondent. In due course of time, the first respondent obtained
permission from the State vide order dated 17th August, 2006 and
consequently was able to have the sale deed executed and registered on
6th September, 2006.
       7. The first respondent having applied for mutation of the subject        D
property in its name, an order of rejection thereof came to be passed on
22nd December, 2006 in the circumstances noted now. On 18 th January,
2005, an ex parte assessment order under the provisions of the Himachal
Pradesh General Sales Tax Act, 1968 (for brevity “HPGST Act”,
hereafter) was passed in relation to the assessment years 1998-1999,
1999-2000, 2000-2001 and 2001-2002 against Regent and Eastman                    E
amounting to Rs. 19,03,845/- and Rs.13,73,115/- respectively. Having
regard to the date of the ex parte assessment order, it is quite but natural
that when the first respondent offered its bid for purchasing the subject
property in the auction ultimately conducted (on 18th January, 2005), any
outstanding liability of either Regent or Eastman could not and was not          F
reflected in any official record. However, in view of this liability of Regent
and Eastman, the application of the first respondent for mutation in respect
of the subject property in its name stood rejected. Such order revealed
that on the asking of the Excise and Taxation Officer, Nahan, District
Sirmour, entries in red ink had been made by the Tehsildar, Nahan
pertaining to demand of arrears of tax payable by Regent and Eastman             G
under the provisions of the HPGST Act.
       8. The order of rejection dated 22nd December, 2006 was assailed
in the writ petitionand orders were sought seeking (i) deletion of adverse
entries regarding the sales tax liability of Regent and Eastman; (ii)
direction upon the tehsildar to mutate the subject property, after quashing      H
780            SUPREME COURT REPORTS                           [2023] 4 S.C.R.


A     of the order dated 22nd December 2006;and (iii) declaring the action of
      the excise and taxation officeras illegal, unjust and without the authority
      of law.
            9. Upon a contested hearing, a Division Bench of the High Court
      allowed the writ petition on terms noted above in paragraph 2 supra.
B           10. We consider it appropriate to reproduce certain other
      paragraphs from the impugned judgment dated 7th September, 2007,
      hereunder:-
            “Undoubtedly, Section 16-B of the Tax Act also contains a
            non-obstante clause, which makes the amount of tax payable
C           by a dealer to be a first charge on the property of the dealer.
            There is, thus, obviously a conflict between the provisions of
            the two statutes.
            The powers are absolute and in view of the non obstante clause
            contained in Section 35 of the Act, would have an overriding
D           effect over all inconsistent provisions contained in any other
            law. The Act being a special statute, enacted later in point in
            time and that too by the Central Government (sic, Parliament),
            in our view, would override the inconsistent provisions
            contained in the Tax Act. This is in the scheme of constitutional
E           provisions also. Therefore, the Bank is well within its right to
            take over the property and sell the same notwithstanding the
            1st charge of the State on the property of the dealer.
            The issue needs to be examined from another perspective.
            Under the provisions of the Tax Act, the Assessing Authority
F           is required to assess the amount of tax due from the dealer on
            the basis of returns filed. If the Assessing Authority is not
            satisfied that the returns furnished are correct and complete
            or that no returns have been filed at all he shall serve a notice,
            give an opportunity of hearing and as the case may arise,
            adopt the best judgment method and assess the amount of tax
G           due from the dealer. This is so provided under section 14 of
            the Tax Act. The amount so assessed is required to be paid by
            the assessee within the time stipulated in the notice to be issued
            by the Assessing Authority, failing which the amount due is
            recoverable as arrears of land revenue as provided for under
            section 16, which, however, in view of non obstante clause
H
    STATE OF HIMACHAL PRADESH v. M/S A.J.                           781
INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

 contained in section 16A comes into operation only after the       A
 dealer failed to pay the amount due when a notice in writing
 is issued to him. Now, in the present case no notice of demand,
 as stipulated under section 14(7) or section 16A has been
 issued to any of the dealers.The action of respondent no. 5 in
 asking respondents no. 3 and 4 and also the action of
                                                                    B
 respondents no. 4 in acting upon the request of respondent
 no. 5 to make entries (in red ink) of arrears of tax due
 recoverable as land revenue in the revenue record is thus bad
 in law. For the very same reason, in spite of No Objection
 issued by the State for getting the sale deed executed is thus
 in gross violations of the provisions of the Tax Act.              C
 Further the right of the respondent-State to have a first charge
 on the property of the dealer can be only if there is proper
 adjudication and determination of the amount due under the
 Tax Act and in the absence thereof, it cannot be said that the
 tax is due and payable by the dealer. Till such time, the same     D
 is done, there cannot be any crystallization of charge. The
 charge of the State is not a floating charge.
 In the instant case the Bank had already exercised its right
 and taken possession of the property much prior to the
 assessment order dated 18-01-05 passed by the Assessing            E
 Authority. In fact before the said date the property itself had
 been advertised to be sold by public auction. No notice of
 demand was ever issued under Section 14 and 16A before
 action under section 16 of the Tax Act was taken. Assuming
 that the first charge stood created prior to the passing of the
 order of assessment, in our view the provisions of section 35      F
 of the Act would override the inconsistent provisions of section
 16B of the Tax Act leading to the only conclusion and that
 there is no prior charge on the property except for that of the
 Bank with whom the property was mortgaged. Thus, in our
 view, looking from all angles the action of the State cannot       G
 be upheld.
 The creation of 1st charge or status of encumbrance of
 property was recorded for the 1st time on 11-07-06. The record
 of rights, i.e. revenue record did not reflect any status of
 encumbrance of the property or creation of 1st charge in spite     H
782            SUPREME COURT REPORTS                           [2023] 4 S.C.R.


A           of the fact that the respondents were duly informed about the
            auction and issuance of the sale certificate by the Bank in
            favour of the petitioner. It was only when the State was
            satisfied about the non-encumbrance that the permission to
            transfer the property in the name of the petitioner was
            accorded. In fact, based on the revenue record the Bank
B
            considered the property to be encumbered and accepted the
            same as a security. It took over the same and put it to auction
            as a secured asset which stands purchased by the petitioner
            as such.”
                                                                (emphasis ours)
C
            Civil Appeal Nos.9212-9213/2012
             11. Punjab National Bank (for brevity “PNB”, hereafter)
      sanctioned term loan to M/s Superrugs (India) Pvt. Ltd. (for brevity
      “borrower”, hereafter) for manufacturing carpets. The loan that was
D     provided by PNB to the borrower was secured by mortgage of its factory
      premises situated at Baddi Industrial Area, District Solan.Shri R.T. Tejpal
      and Shri Durga Dass stood as guarantors (for brevity “guarantors”,
      hereafter). The loan account of the borrower became irregular. A
      recovery suit was instituted by PNB against the borrower and the
      guarantors for Rs. 42.29 lacs. Upon introduction of the Recovery of
E     Debts due to Banks and Financial Institutions Act, 1993 (for brevity
      “DRT Act”, hereafter) and constitution of the Debts Recovery Tribunals,
      the suit was transferred to the Debts Recovery Tribunal, Jaipur (for
      brevity “DRT, Jaipur”, hereafter). Consent decree was passed on
      12th November, 1998 in favour of PNB and against the borrower and
F     the guarantors. Part payment was made by the borrower towards
      satisfaction of the decree, but balance payment was not made resulting
      in PNB levying execution of the recovery certificate for an amount of
      Rs.2,65,97,162.50 before the DRT, Jaipur on14th May, 1999. Subsequently,
      the proceedings for execution were transferred to the Debts Recovery
      Tribunal, Chandigarh (for brevity “DRT, Chandigarh”, hereafter) on
G     2nd January, 2000. During pendency of the proceedings, the Assistant
      Excise and Taxation Commissioner, District Solan (for brevity
      “Commissioner”, hereafter), issued a notice in ‘The Tribune’ in its edition
      dated 12thFebruary, 2000 for auction of the property that was mortgaged
      by the borrower. Auction was fixed for 3rd March, 2001 for recovery of
H     arrears of sales tax amounting to Rs.32,72,365/-, which was recoverable
           STATE OF HIMACHAL PRADESH v. M/S A.J.                              783
       INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

as arrears of land revenue under the Himachal Pradesh Land Revenue            A
Act, 1954 (for brevity “HPLR Act”, hereafter). PNB moved an
application before the Recovery Officer attached to the DRT, Chandigarh
for stay of auction whereupon the said recovery officer considering the
law laid downby this Court in State Bank of Bikaner & Jaipur vs.
National Iron & Steel Rolling Corporation and Ors. 4 concluded that
                                                                              B
the claim of PNB against the mortgaged property had become secondary
in view of the auction initiated by the State for recovery of sales tax
dues. This resulted in PNB invoking the jurisdiction of the High Court
under Article 226 by filing a writ petition 5against the State, the
Commissioner, the Recovery Officer of the Debts Recovery Tribunal,
Chandigarh, the borrower and the guarantors.                                  C
      12. Prayer in the writ petition was for orders restraining sale by
auction of the mortgaged property of the borrower at Baddi, District
Solan for recovery of arrears of sales tax dues, and to strike down section
16-B of the HPGST Act as ultravires the provisions of the Constitution,
the DRT Act, the Transfer of Property Act, 1872, the Contract Act,            D
1872 and the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970 (for brevity “Banking Companies Act”,
hereafter).
       13. The State and the Commissioner contested the writ petition
by contending that the borrowerowed Rs. 32,72,365/ to the Government          E
of Himachal Pradesh on account of arrears of sales tax which had been
declared as arrears under the HPLR Act. It was further contented that
the State is competent to recover the amount as it has a first charge on
the property of the dealer under section 16-B of the HPGST Act read
with section 73(3) of the Code of Civil Procedure (for brevity “the CPC”,
hereafter). It was further contented that it is wrong on the part of the      F
PNB to contend that its debtis prior in point of time. Section 16-B of the
HPGST Act had come into force with effect from 21st October, 1994
whereas the consent decree was passed in favour of PNB on
12th November, 1998. This being the position, the provisions of section
16-B of the HPGST Act would apply and that PNB was not entitled to            G
any relief. Reference was made to the decision of this Court in State
Bank of Bikaner and Jaipur (supra) where this Court
consideredsection 11-AAAA of the Rajasthan Sales Tax Act, 1954, which
4
    (1995) 2 SCC 19
5
     CWP No. 239 of 2001                                                      H
784               SUPREME COURT REPORTS                         [2023] 4 S.C.R.


A     is parimateria with section 16-B of the HPGST Act, creating a first
      charge on the property of the dealer. In the light of the said decision, the
      contention of PNB that it had the prior right to recovery of the debt was
      claimed to be devoid of substance and, in fact, misconceived.
             14. The writ petition of PNB come to be allowed by the High
B     Court vide its judgment and order dated 2nd January, 2008. The judgment
      and order dated 7th September, 2007 rendered by the High Court on the
      writ petition6 titled M/s A.J. Infrastructures Pvt. Ltd. vs. State of
      H.P. and others, being the judgment and order impugned in Civil Appeal
      No. 8980of 2012,was relied upon. Although while deciding M/s A.J.
      Infrastructures Pvt. Ltd. (supra) the High Court had not declared
C     section 35 of the SARFAESI Act as ultra vires, the Division Bench of
      the High Court in seisin of the writ petition of PNB proceeded a step
      further and held section 16-B of the HPGST Act to be inconsistent with
      section 35 of the SARFAESIAct; and,then declared the said section as
      ultra vires the Constitution and the Banking Companies Act. The writ
D     petition filed by PNB was, accordingly, allowed and it was held that
      PNB was entitled to sell the mortgaged property ofthe borrower in
      accordance with law.
               15. The Division Bench of the High Court also recorded as follows
      :-
E              “In the present case, the mortgage was created in the year
               1984 and the consent decree was passed on 12.11.1998 in
               favour of the petitioner bank and against respondents No. 4
               to 6. There is nothing on record to show that any notice of
               demand was firstly issued under Sections 14 and 16 A before
F              action under Section 16 of the Sales Tax Act was taken. The
               copies of the notice of demand issued and when it was issued
               have not been placed on record by respondents No. 1 & 2
               except by pleading about their right to sell the property and
               recover the amount as arrears of land revenue in preference
               to the petitioner bank. Therefore, in view of the decision in
G              Dena Bank’s case it is clear that it only gives preferential
               right to the State to recover the sales tax in preference to
               unsecured creditors but once the property in question already
               stood mortgaged and they had proceeded prior in time, they
      6
          CWP No. 306/2007
H
          STATE OF HIMACHAL PRADESH v. M/S A.J.                              785
      INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

         can recover the amount in pursuance of the consent decree           A
         passed in their favour, the State has no preferential right to
         sell the property and, therefore, the petitioner bank is entitled
         to sell the mortgaged property and realize the arrears of
         amount due to them and State shall be entitled to recover the
         balance amount, if any, left with the bank or in the alternative,
                                                                             B
         they are at liberty to proceed against respondents No. 4 to 6
         for recovery of the amount by proceeding against them in
         accordance with law. The Division Bench in the above case
         has already taken the view that the provisions of Section 35
         of the Act would override the inconsistent provisions of Section
         16B of the Tax Act and as such, there provisions of the Sales       C
         Tax Act Section 16B as they are inconsistent with Section 35
         of the Act are declared ultravires of the Constitution.”
                                                         (emphasis ours)
       16. Dissatisfied with the judgment and order dated 2nd January
2008, the State and the Commissioner on 22 nd May, 2008filed an              D
application7 under section 151 of the CPC for “rectification etc., of the
judgment/order dated 2nd January, 2008”. The prayer in such petition
was for recall of the judgment and order dated 2nd January, 2008 in the
interest of justice, equity and fair play so that theapplicants are saved
from enormous adverse consequences of such judgment and order.               E
      17. The said application came to be considered by the same
Division Bench (which had decided the writ petition) and stood
dismissed, inter alia, by the following order dated 5th June, 2008:
         “This application under Section 151 CPC has been
         purportedly (sic, filed) for rectification of our judgement dated   F
         2.1.2008. However, in the prayer clause it has been prayed
         that the judgement dated 2nd January, 2008 may be recalled.
         It is clear that under the garb of this application the State is
         seeking review of the judgement.
         We need not burden ourselves with the various grounds taken         G
         in the application. The perusal of the application shows that
         it is virtually a review petition but has been styled to be an
         application under Section 151 CPC. This cannot be permitted.

7
    CMP No. 1205 of 2008                                                     H
786             SUPREME COURT REPORTS                            [2023] 4 S.C.R.


A           Various facts have now been pleaded in this application, which
            were neither pleaded nor argued when the writ petition was
            heard and decided. In an application under Section 151 CPC,
            the applicants cannot be permitted to rake up absolutely new
            pleas which were never taken or argued in the writ petition.
            In case the State is aggrieved by the judgment, it has the
B
            remedy of approaching the apex Court. There is no error
            apparent on the face of the record of the judgement. The
            application being without any merit and being totally
            misconceived, is rejected”.
             18. The judgment and order dated 2nd January, 2008 allowing the
C     writ petition has been challenged in Civil Appeal No. 9212 of 2012 whereas
      the order of dismissal of the application under section 151 of the CPC is
      the subject matter of challenge in Civil Appeal No. 9213/2012.
            Proceedings before this Court

D           19. Grant of relief claimed in the writ petitions and dismissal of
      the two applications of the State and its officers for review of the judgment
      and order/under section 151 of the CPC led the State and its officers to
      approach this Court with separate special leave petitions.
            20. Certain orders passed in these proceedings need to be noted.
E           21. On the special leave petitionscarried by the State from the
      judgment and order passed on PNB’s writ petition and the order of
      dismissal of the State’s application under section 151 of the CPC, an
      order was passed by this Court on 11th March, 2011 recording as follows:
            “The respondent-Bank has filed an affidavit contending inter
F           alia that they have recovered their dues and also released the
            property, which was under mortgage in favour of the borrower
            since they have liquidated the loan amount with interest.
            Counsel appearing for the State seeks for a week’s time to
            enable him to obtain instructions.
G           He may obtain instructions accordingly.
            Re-notify on 18.3.2011.”
            22. The next effective order dated 8th April, 2011 passed by this
      Court on the aforesaid special leave petitions recorded that:

H
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                 787
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

      “So far these petitions are concerned, in our considered                A
      opinion, these petitions have been rendered infructuous partly
      in view of the fact that bank, who is a contesting respondent
      no. 1 herein, has already recovered its dues and thereafter
      released the property from its hypothecation. Hence, the name
      of respondent no. 1 is deleted from the array of respondents
                                                                              B
      and the petitions as against respondent no. 1 stand dismissed.
      These petitions also stand dismissed so far as respondent nos.
      3 and 5 are concerned. Therefore, these petitions survive only
      against respondent nos. 2 and 4.”
      23. As a result of the above order, the special leave petitions stood   C
dismissed against PNB (the first respondent), the borrower (the second
respondent) and Shri Durga Dass (the fifth respondent) and survived
qua the Recovery Officer, DRT, Chandigarh (the second respondent)
and Shri R.T. Tejpal (the fourth respondent).
       24. Practically, with the exit of PNB from the proceedings in view     D
of the developments subsequent to filing of the special leave petitions
resulting in dismissal of the special leave petitions qua PNB, it admits of
no doubt that the issue inter se the relevant parties, i.e., the State and
PNB, as to whether the High Court was justified in outlawing section
16-B of the HPGST Act,attained finality.
                                                                              E
      25. Notwithstanding such position, this Court on 7th December,
2012 granted special leave on both the petitions to appeal whereupon
the appeals were placed before us for hearing anddecision.
      Issues
      26. The legal issues arising for decision on these appeals are:         F
      (i)      Whether, in view of dismissal of the special leave petition
               qua PNB by the order dated 8th April, 2011, the judgment
               and order outlawing section 16-B of the HPGST Act can at
               all be examined?
      (ii)     Should the answer to the above question be in the              G
               affirmative, whether section 16-B of the HPGST Act should
               have been outlawed by the High Court on the ground that it
               is ultra vires the Constitution or the Banking Companies
               Act?
                                                                              H
788                  SUPREME COURT REPORTS                         [2023] 4 S.C.R.


A              (iii)   Whether having regard to the facts and circumstances
                       triggering the writ petitions, the High Court was justified in
                       returning the findings that the State’s claim of first charge
                       on the subject properties is not substantiated?
               (iv)    Whether dismissal of the review petition/application for
B                      recallinstituted by the State by the High Court suffers from
                       any infirmity, legal or otherwise?
               (v)     To what relief, if any, are the appellants entitled?
               Analysis and Reasons
              27. Insofar as the first issue is concerned,we may notice the
C     Constitution Bench decision in A.R. Antulay vs. R.S. Nayak8. It was
      held there that one of the well-known principles oflaw is that a decision
      made by a competent court of law should be taken as final subject to
      any decision of a superior court in further proceedings contemplated by
      the law of procedure. However, this Court being the apex court, alitigant
D     cannot approach any higher forum but can only invoke its review
      jurisdiction to correct a patent error. The power to review is also inherent
      in this Court and ifjudicial satisfaction is reached that an order has been
      passed, which ought not to have been passed, and it is accepted that a
      mistake has been committed, it is not only appropriate but also the duty
      of this Court to rectify the mistake by exercising inherent powers. Mistake
E     of the Court can be corrected by the Court itself without any fetters.
      This is based on the principle that an act of Court ought not to injure any
      party before it. To own up the mistake when judicial satisfaction is reached
      does not militate against the Court’s status or authority; perhaps it would
      enhance both.
F            28. There can be no doubt that in normal circumstances this Court
      would not allow reopening of an issue that has attained finality and, that
      too, in the absence of party who has benefited by reason of such an
      order. However, this is not a normal case and we can unhesitatingly
      record our satisfaction of a gross error having crept in requiring correction.
G            29. A law, which the State legislature had the competence to enact,
      has been outlawed by the High Court while hearing a writ petition which
      was rendered infructuous due to developments subsequent to its filingand
      prior to its disposal but such developments had not been brought to the
      notice of the High Court.
      8
H         (1988) 2 SCC 602
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                     789
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

        30. During the pendency of these proceedings where challenge              A
had been laid to the judgment and order dated 2nd January, 2008 of the
High Court, PNB filed an affidavit dated 30th September, 2010, referred
to in the order of this Court dated 8th April, 2011. A reading of the affidavit
reveals that during the pendency of the writ petition (filed by PNB)
before the High Court, the borrower had offered a compromise proposal
                                                                                  B
which PNB had accepted. In terms thereof, the borrower paid to PNB
an amount of Rs.36 lakh towards full and final settlement of the loan
liability.Upon receipt of the compromise amount, the title deed of the
mortgaged property was duly returned to the borrower. Pursuant thereto,
PNB filed an application for withdrawing the execution case before the
Recovery Officer, DRT, Chandigarh on 13th August, 2002 and the case,              C
upon being disposed of as withdrawn, was consigned to the record room.
It was further categorically averred in paragraph 3(g) of the said affidavit
that “the grievance of respondent no.1 raised in the writ petition
filed before the Hon’ble High Court does not subsist any further
and that the object of having filed the writ petition is already fulfilled
                                                                                  D
and that the writ petition has been rendered infructuous”. Ultimately,
in paragraph 5, PNB submitted that”it extends its unconditional
apology for not bringing the aforesaid facts to the notice of Hon’ble
High Court at the time of reserving the orders in writ petition on
27 th November, 2007" and that “the aforesaid facts could not be
brought to the notice of Hon’ble High Court due to inadvertence                   E
and the same was not deliberate or intentional”.
       31. Therefore, for all intents and purposes, the High Court by its
judgment and order dated 2nd January, 2008 decided an infructuous writ
petition and, in the process, outlawed section 16-Bof the HPGST Act
when the same was not at all warranted.                                           F
       32. In our considered opinion, it was also a clear but inadvertent
error on the part of this Court to dismiss only the special leave petition
against PNB as infructuous; the appropriate course for this Court ought
to have been to dismiss the writ petition of PNB itself as infructuous
having regard to the clear stand taken by PNB in its aforesaid affidavit          G
dated 30th September, 2010 that nothing survived for a decision on the
writ petition on the date it was decided in view of release of the property
from mortgage.
       33. We, accordingly, answer the first issue in the affirmative.
                                                                                  H
790                SUPREME COURT REPORTS                        [2023] 4 S.C.R.


A           34. Moving on to the second issue, we are clear in our mind that
      the same ought to be answered in the negative.
             35. The easy answer to the issue flows from what we have
      discussed above. Since the writ petition had been rendered infructuous
      on the date it was decided, it was not necessary for the High Court to
B     pronounce on the validity of section 16-B. A decision on the constitutional
      validity of a provision should be invited not in vacuum but when the
      justice of the case demands such a decision. Hence, we hold that the
      decision on an infructuous writ petition is inconsequential and can never
      be of any effect. However, we do not wish to rest our decision only on
      this technical point. Having considered the relevant provisions of law as
C     well as the decisions of this Court, rendered prior to and post the impugned
      judgment and order dated 2nd January, 2008, we are of the firm opinion
      that the issue as to whether section 16-B of the HPGST Act is ultra
      vires any provision of law including the supreme law of the country is no
      longer res integra.
D            36. Instead of burdening our judgment by referring to all decisions
      on the point, we consider it appropriate to refer to only one decision of
      this Court (dated 27th February, 2009)in Central Bank of India vs.
      State of Kerala 9 which, of course, came into existence after the
      decisions challenged in these civil appeals were rendered. This Court
E     having considered the provisions of the DRT Act and the SARFAESI
      Act, as it then stood, vis-à-vis section 38-C of the Bombay Sales Tax
      Act, 1959 and section 26-B of the Kerala General Sales Tax Act, 1963,
      inter alia, held that:
               “116.The non obstante clauses contained in Section 34(1) of
F              the DRT Act and Section 35 of the Securitisation Act give
               overriding effect to the provisions of those Acts only if there
               is anything inconsistent contained in any other law or
               instrument having effect by virtue of any other law. In other
               words, if there is no provision in the other enactments which
               are inconsistent with the DRT Act or the Securitisation Act,
G              the provisions contained in those Acts cannot override other
               legislations. Section 38-C of the Bombay Act and Section 26-
               B of the Kerala Act also contain non obstante clauses and
               give statutory recognition to the priority of the State’s charge
               over other debts, which was recognised by Indian High Courts
      9
H         (2009) 4 SCC 94
    STATE OF HIMACHAL PRADESH v. M/S A.J.                             791
INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

 even before 1950. In other words, these sections and similar         A
 provisions contained in other State legislations not only create
 first charge on the property of the dealer or any other person
 liable to pay sales tax, etc. but also give them overriding effect
 over other laws.
   ***                                                                B
 126. While enacting the DRT Act and the Securitisation Act,
 Parliament was aware of the law laid down by this Court
 wherein priority of the State dues was recognised. If Parliament
 intended to create first charge in favour of banks, financial
 institutions or other secured creditors on the property of the       C
 borrower, then it would have incorporated a provision like
 Section 529-A of the Companies Act or Section 11(2) of the
 EPF Act and ensured that notwithstanding series of judicial
 pronouncements, dues of banks, financial institutions and
 other secured creditors should have priority over the State’s
 statutory first charge in the matter of recovery of the dues of      D
 sales tax, etc. However, the fact of the matter is that no such
 provision has been incorporated in either of these enactments
 despite conferment of extraordinary power upon the secured
 creditors to take possession and dispose of the secured assets
 without the intervention of the court or Tribunal. The reason        E
 for this omission appears to be that the new legal regime
 envisages transfer of secured assets to private companies.
 127. The definition of ‘secured creditor ’ includes
 securitisation/reconstruction company and any other trustee
 holding securities on behalf of bank/financial institution. The      F
 definition of ‘securitisation company’ and ‘reconstruction
 company’ in Sections 2(1)(za) and (v) shows that these
 companies may be private companies registered under the
 Companies Act, 1956 and having a certificate of registration
 from Reserve Bank under Section 3 of the Securitisation Act.
 Evidently, Parliament did not intend to give priority to the         G
 dues of private creditors over sovereign debt of the State.
 128. If the provisions of the DRT Act and the Securitisation
 Act are interpreted keeping in view the background and
 context in which these legislations were enacted and the
                                                                      H
792            SUPREME COURT REPORTS                          [2023] 4 S.C.R.


A           purpose sought to be achieved by their enactment, it becomes
            clear that the two legislations, are intended to create a new
            dispensation for expeditious recovery of dues of banks,
            financial institutions and secured creditors and adjudication
            of the grievance made by any aggrieved person qua the
            procedure adopted by the banks, financial institutions and
B
            other secured creditors, but the provisions contained therein
            cannot be read as creating first charge in favour of banks,
            etc.
            129. If Parliament intended to give priority to the dues of
            banks, financial institutions and other secured creditors over
C           the first charge created under State legislations then provisions
            similar to those contained in Section 14-A of the Workmen’s
            Compensation Act, 1923, Section 11(2) of the EPF Act, Section
            74(1) of the Estate Duty Act, 1953, Section 25(2) of the Mines
            and Minerals (Regulation and Development) Act, 1957,
D           Section 30 of the Gift Tax Act, and Section 529-A of the
            Companies Act, 1956 would have been incorporated in the
            DRT Act and the Securitisation Act.
            130. Undisputedly, the two enactments do not contain
            provision similar to the Workmen’s Compensation Act, etc. In
E           the absence of any specific provision to that effect, it is not
            possible to read any conflict or inconsistency or overlapping
            between the provisions of the DRT Act and the Securitisation
            Act on the one hand and Section 38-C of the Bombay Act and
            Section 26-B of the Kerala Act on the other and the non
            obstante clauses contained in Section 34(1) of the DRT Act
F           and Section 35 of the Securitisation Act cannot be invoked
            for declaring that the first charge created under the State
            legislation will not operate qua or affect the proceedings
            initiated by banks, financial institutions and other secured
            creditors for recovery of their dues or enforcement of security
G           interest, as the case may be.”
                                                              (emphasis ours)
            37. It is much after this decision in Central Bank of India (supra)
      that Parliament proceeded to amend the DRT Act and the SARFAESI
      Act by the Enforcement of Security Interest and Recovery of Debts
H
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                 793
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

Laws and Miscellaneous Provisions (Amendment) Act, 2016. Chapter              A
IV-A was introduced in the SARFAESI Act, with effect from 24 th
January, 2020, containing, inter alia, section 26E which accorded priority
in payment to a secured creditor over all other dues in enforcement of
the security, subject to conditions specified elsewhere in the said
chapter.Prior thereto, with effect from 1st September, 2016, section 31B
                                                                              B
was introduced in the DRT Act extending similar benefit of priority to a
secured creditor.We need not dilate here on the amended provisions for
obvious reasons.
       38. What appears to be of significance in the light of the decision
in Central Bank of India (supra) is that the findings in the judgments
and orders disposing of the writ petitions impugned in two of the four        C
civil appeals ~ the first dated 7th September, 2007 and the other dated
2nd January, 2008 ~with regard to the scope, ambit and applicability of
section 35 of the SARFAESI Act, more particularly the latter holding
section 16-B of the HPGST Act as ultra vires the Constitution and the
Banking Companies Act, loses its basis and can no longer be held to be        D
legal and valid. Section 35 of the SARFAESI Act could not have been
construed as conferring any right on a secured creditor to claim priority
over dues of the State in the absence of a provision in that behalf which
presently can now be claimed, subject to other conditions being fulfilled,
in view of section 26E of the SARFAESI Act.
                                                                              E
       39. Pertinently, the High Court while seized of the writ petition of
PNB was not at all concerned with the SARFAESI Act as such. The
matter had travelled to the High Court from proceedings under the DRT
Act. There was, thus, no occasion for the High Court to pronounce on
the validity of section 16-B of the HPGST Act based on what was held
by its coordinate Bench in M/s A.J.Infrastructures Pvt. Ltd. (supra).         F
The High Court, in our considered view, was therefore in clear error.
       40. In the light of the above, while answering the second issue we
hold that section 16-B of the HPGST Act is a perfectly valid piece of
legislation and is not ultra viresthe Constitution and/or the Banking
Companies Act as erroneously held in the decision of the High Court           G
dated 2nd January, 2008. Also, following the decision in Central Bank
of India (supra), we hold that any observation in the decision dated 7th
September, 2007 touching upon section 16-B of the HPGST Act vis-à-
vis section 35 of the SARFAESI Act is of no effect.
                                                                              H
794             SUPREME COURT REPORTS                            [2023] 4 S.C.R.


A           41. It is now time to consider the third issue.
             42. As noted above, C.A. Nos.9212-9213 of 2012 have been
      dismissed qua the writ petitioner, i.e., PNB. Having regard to such position,
      it would not be proper to delve deep into the question as to whether the
      State has the first charge over the property in question or not. This is
B     particularly because PNB was not represented before us on the date
      judgment was reserved inview of the prior dismissal of the civil appeals
      and no application had been filed by the State to recall such order. We
      furtherdo not consider it appropriate to reopen the proceedings against
      PNB, bearing in mind the circumstance that more than a decade has
      lapsed since the order of this Court dated 8th April, 2011 was made.
C     However, if the lis in the writ petition of PNB had subsisted, we would
      have ruled in its favour upon acceptance of the other reasons in the
      decision dated 7th September, 2007 which, in the extracted portion, has
      been highlighted by us above. We, therefore,would allow the matter to
      rest.
D           43. Before parting with C.A. Nos.9212-9213 of 2012, we may
      observe that in view of the findings returned by the High Court on the
      question of absence of determination of liability, with which we have
      concurred, it was absolutely unnecessary for the High Court to outlaw
      section 16-B of the HPGST Act.
E            44. Insofar as C.A.Nos.8980-8981of 2012 isconcerned, the third
      issue is very much alive and needs to be addressed.
              45. The discussion must begin with a reading of the relevant
      provisions of the HPGST Act. Section 14 of the HPGST Act postulates
      assessment of tax. The cumulative effect of the several sub-sections of
F     section 14 is that after returns are furnished by a dealer in respect of
      any period, the duty of the assessing authority is to assess the appropriate
      quantum of tax required to be paid by the dealer, in terms of the procedure
      laid down therein; and to initiate steps, also in terms of the laid down
      procedure, to recover any amount of unpaid tax, penalty or interest
G     payable under the enactment.Section 16 envisages that any amount of
      tax, penalty or interest payable under the HPGST Act remaining unpaid
      after the due date shall be recoverable as arrears of land revenue. Section
      16-A, starting with a non-obstante clause, confers power on the
      Commissioner or any officer other than the one excluded to initiate a
      special mode of recovery. Then follows section 16-B, which is to the
H     following effect:-
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                   795
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

      “16-B. Tax to be first charge on property.- Notwithstanding               A
      anything to the contrary contained in any law for the time
      being in force, any amount of tax and penalty including
      interest, if any, payable by a dealer or any other person under
      this Act shall be a fust charge on the property of the dealer or
      such other person.”
                                                                                B
       46. Having regard to the terms of section 16 of the HPGST Act
notedabove, the HPLR Act, to the extent the same provides for the
procedure for recovery of dues as arrears of land revenue, needs to be
briefly noticed.
       47. Section 4(4) of the HPLR Act defines a defaulter as a person         C
liable forarrears of land revenue and includessuch person who are
responsible as surety for the payment of the arrears. Section 23 provides
for the mode of making proclamation issued by a Revenue Officer
relating to any land and provides for the methods of proclamation. Chapter
VI of the HPLR Act, is titled “Collection of Land Revenue”. Section 74
sets out the process for recovery of the arrears while section 78 provides      D
for attachment of theestate or holding. Section 75 ordains that a writ of
demand may be issued by the Revenue Officer on or after the date on
which thearrears of land revenue accrue.Section 75-A envisages that at
any time after arrears of land revenue accrue, a Revenue Officer may
issue a warrant directing an officer named therein to arrest the defaulter      E
and bring him before the Revenue Officer and section 81 confers power
of sale of estate or holding. Although, there is no express provision
indicating the stage at which a defaulter can deny this liability, section 84
opensup a remedy to a person denying hisliability before a Civil Court.
       48. From the excerpt of the impugned judgment and order of the           F
High Court dated 2nd January, 2008underlined above, it is clear that
proceedings were not initiated upon notice to the defaulters and the sum
they owed to the department had not been finally determined in
accordance with law. In view thereof, question of the State resorting to
the provisions contained in Chapter VI of the HPLR Act for recovering
the dues, if at all, as arrears of land revenue did not arise. The Excise       G
Department, in its reply to CWP 306 of 2007, submitted that the non-
obstante provision contained in section 16-B would prevail over any
inconsistent provisions in other laws; it was further submitted that in the
event of any conflict between any other statute and the HPGST, the
latter would prevail. The department further urged that sales taxes dues        H
796            SUPREME COURT REPORTS                          [2023] 4 S.C.R.


A     would be higher in priority over any mortgage since the State would
      have a first charge. It was also submitted that the Tehsildar was
      requested, on multiple occasions, to make the required red entries in
      relation to the revenue records of the subject property, and not mutate/
      register the same at the behest of the first respondent.
B            49. While adopting such a stand, the State and its department
      either overlooked or were ignorant of the requirement of law that section
      16-B would be attracted only after determination of the liability and upon
      any sum becoming due and payable; and that, it is only thereafter that
      the charge, if any, would operate. We are of the opinion that no relevant
      documentary evidence having been placed before the High Court, when
C     CWP 306 of 2007 was being heard, to indicate that necessary steps
      under the HPGST Act had been initiated by the State and its officers,
      the third issue has to be answered by holding that the State not having
      taken steps as required by law for realization of its dues, there was no
      determination of liability, a fortiori, question of taking recourse to the
D     HPLR Act for recovery of dues as arrears of land revenue did not arise.
      Without such determination of liability, no red entry marks could have
      been inserted in the revenue records and the High Court was right in
      holding that the State ought not to have refused mutation.
             50. The fourth issue need not detain us for too long.As it is, the
E     civil appeals against PNB do not survive.Qua the other appeals, we are
      once again of the opinion that the High Court was justified in not
      entertaining the application for recall. It was not maintainable in law,
      since the writ petition was decided on merits in the presence of the
      State. A recall application under section 151 of the CPC,therefore, was
      not the proper remedy in the circumstances. When the law provides a
F     specific remedy, it is not open to a party to take recourse to section
      151.It preserves the inherent powers of the court to do justice in a case
      where the party has no other remedy under the CPC.Besides, even if
      the application for recall could have been regarded as one for review of
      the judgment and order dated 7th September, 2007, the same did not
G     warrant to be entertained for the reasons assigned by the High Court.No
      error apparent on the face of the record was pointed out, which is the
      firstground for seeking a review. Documents were annexed to the
      application, which were in existence when the reply to CWP 306 of
      2007 was filed by the State and no case had been set up that despite
      discharge of due diligence, such documentary evidence, which were in
H
        STATE OF HIMACHAL PRADESH v. M/S A.J.                                      797
    INFRASTRUCTURES PVT. LTD [DIPANKAR DATTA, J.]

existence, could not be annexed to the said reply. Much indulgence is              A
shown to the State Governmentswhen they carryjudgments/orders in
time-barred appeals/revisions, having regard to the impersonal machinery
being involved. However, undueindulgence cannot be shown to the State
Governments either when they do not file a proper reply or when, despite
there being a provision for review, such remedy is not pursued and a
                                                                                   B
different one pursued presumably to overcome the restrictions the
provision for review imposes. We, therefore, answer this issue by holding
that High Court was justified in rejecting the application for recall.
       51. The fifth issue stands disposed of by holding that the appellants
(State and its officers) are not entitled to any relief except the declaration
that section 16-B of the HPGST Act is not ultra vires any provision of             C
law.In view of section 16-B having been outlawed by the High Court on
2nd January, 2008, this declaration shall not enure to the benefit of the
State in respect of cases that are old and have been closed but would be
effective once again from this day.
      52. Consequently, all the civil appeals stand disposed of on the             D
aforesaid terms.Parties shall bear their own costs.

Divya Pandey                                                Appeals disposed of.
(Assisted by : Roopanshi Virang, LCRA)
                                                                                   E




                                                                                   F




                                                                                   G




                                                                                   H