FACTS:

 The appellants were dealers in tobacco and have their place of business in Ujjain.
 They purchase and sales tobacco use for eating, smoking and for preparing bidis.
 They also get their tobacco locally or import it from other states
 At that time in Madhya Pradesh an act called madhya bharat sales tax act (act 30 of 1950)
came into force on May 01 1950.
 Under section 3 of the act, every dealer who’s business in the previous year in respect of sales
or supplies of goods exceeded by 12000 had to pay taxes in respect of sales only.
 Under section 5 , the tax was a single point tax and it was provided that the government should
specify the point of sales at which the tax was payable i.e how much a person should sell to pay
taxes .
 The section also fixed the minimum and maximum rates of tax, leaving it to government to
notify the actual rate i.e. the tax rate was not fixed, however minimum and maximum rate was
fixed.

 Government later issued a number of notifications on April 30 1950, may 22 1950, Oct 24 1950
and Jan 21 1954. All these notifications imposed taxes at different rates on tobacco as stated
above i.e. the tax was not collected at the rate which was stated above .
 The tax was not levied on sale or purchase on tobacco in Madhya Pradesh. The tax was
collected by the authorities in varying amounts from the appellant for different quarters.
 The appellant served notices under sec 80of the civil procedure court which states that no suit
shall be instituted against government / public officer in his official capacity until the expiration of
two Month notice.
SPEAKING JUDGE
The judgement of the court was delivered by C.J, Hidayatullah, who was the eleventh chief
justice of India and sixth Vice-president of India. He is regarded as an eminent jurist, scholar,
educationist, author and linguist. Justice Hidayatullah became the only person to have served in
all three offices of Chief Justice of India, President of India, and the Vice President of India.
During his long tenure in the Supreme Court he was a party to a number of landmark judgments
including the judgment in Golaknath v. State of Punjab which took the view that the Parliament
had no power to cut down the Fundamental Rights by constitutional amendment. His judgment in
the case of Ranjit D. Udeshi dealing with the law of obscenity, displayed a flair for literature which
is not so common among our judges. He was the president of Indian Law Institute, International
Law Association (Indian Branch), Indian Society of International Law from 1968 to 1970. He also
presided the Indian Red Cross Society in 1982. He was closely associated with Hunger Project
of USA, World Association of Orphans and Abandoned Children (Geneva), and Independent
Commission on International Humanitarian Issues (1982–84).
The Hidayatullah National Law University at Naya Raipur is named after him.
DECISION OF COURT
This was a case relating to jurisdiction of civil courts i.e geographical area or subject matter to
which such authority applies and the civil court has inherited power to decide its own jurisdiction .
In the case of Dhulabhai vs State of Madhya pradesh , justice Hidayatullah summarised the
following principles relating to exclusion of jurisdiction of civil courts :
(1) Where the statute gives a finality to the orders of the special tribunals the Civil Courts’
jurisdiction must be held to be excluded if there is adequate remedy to do what the Civil Courts
would normally do in a suit. Such provision, however, does not exclude those cases where the
provisions of the particular Act have not been complied with or the statutory tribunal has not
acted in conformity with the fundamental principles of judicial procedure.
(2) 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.
Where there is no express exclusion the examination of the remedies and the scheme of the
particular Act to find out the intendment becomes necessary and the result of the inquiry may be
decisive. In the latter case it is necessary to see if the statute creates a special right or a liability
and provides for the determination of the right or liability and further lays down that all questions
about the said right and liability shall be determined by the tribunals so constituted, and whether
remedies normally associated with actions in Civil Courts are prescribed by the said statute or
not.
(3) Challenge to the provisions of the particular Act as ultra vires cannot be brought before
Tribunals constituted under that Act. Even the High Court cannot go into that question on a
revision or reference from the decision of the Tribunals.
(4) When a provision is already declared unconstitutional. Or the constitutionality of any provision
is to be challenged, a suit is open. A writ of certiorari may include a direction for refund if the
claim is clearly within the time prescribed by the Limitation Act. But, it is not a compulsory
remedy to replace a suit.
(5) Where the particular Act contains no machinery for refund’ of tax collected in excess of
constitutional limits or illegally collected a suit lies.
(6) Questions of the correctness of the assessment apart from its constitutionality are for. The
decision of the authorities and a civil suit does not lie if the orders of the authorities are declared
to be final or there is an express prohibition in the particular Act. In either case the scheme of the
particular Act must be examined because it is a relevant enquiry.
(7) An exclusion of the jurisdiction of the Civil Court is not readily to be inferred unless the
conditions above set down apply.
In the light of these conclusions we have to see how the present case stands. Section 3 was the
charging section. It spoke of the incidence of the tax. In consisted of several sub-sections. These
sub-sections laid the tax on dealers according to their tax able turnover SPEAKING JUDGE
The judgement of the court was delivered by C.J, Hidayatullah, who was the eleventh chief
justice of India and sixth Vice-president of India. He is regarded as an eminent jurist, scholar,
educationist, author and linguist. Justice Hidayatullah became the only person to have served in
all three offices of Chief Justice of India, President of India, and the Vice President of India.
During his long tenure in the Supreme Court he was a party to a number of landmark judgments
including the judgment in Golaknath v. State of Punjab which took the view that the Parliament
had no power to cut down the Fundamental Rights by constitutional amendment. His judgment in
the case of Ranjit D. Udeshi dealing with the law of obscenity, displayed a flair for literature which
is not so common among our judges. He was the president of Indian Law Institute, International
Law Association (Indian Branch), Indian Society of International Law from 1968 to 1970. He also
presided the Indian Red Cross Society in 1982. He was closely associated with Hunger Project
of USA, World Association of Orphans and Abandoned Children (Geneva), and Independent
Commission on International Humanitarian Issues (1982–84).
The Hidayatullah National Law University at Naya Raipur is named after him.

DECISION OF COURT
This was a case relating to jurisdiction of civil courts i.e geographical area or subject matter to
which such authority applies and the civil court has inherited power to decide its own jurisdiction .
In the case of Dhulabhai vs State of Madhya pradesh , justice Hidayatullah summarised the
following principles relating to exclusion of jurisdiction of civil courts :
(1) Where the statute gives a finality to the orders of the special tribunals the Civil Courts’
jurisdiction must be held to be excluded if there is adequate remedy to do what the Civil Courts
would normally do in a suit. Such provision, however, does not exclude those cases where the
provisions of the particular Act have not been complied with or the statutory tribunal has not
acted in conformity with the fundamental principles of judicial procedure.
(2) 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.
Where there is no express exclusion the examination of the remedies and the scheme of the
particular Act to find out the intendment becomes necessary and the result of the inquiry may be
decisive. In the latter case it is necessary to see if the statute creates a special right or a liability
and provides for the determination of the right or liability and further lays down that all questions
about the said right and liability shall be determined by the tribunals so constituted, and whether
remedies normally associated with actions in Civil Courts are prescribed by the said statute or
not.
(3) Challenge to the provisions of the particular Act as ultra vires cannot be brought before
Tribunals constituted under that Act. Even the High Court cannot go into that question on a
revision or reference from the decision of the Tribunals.
(4) When a provision is already declared unconstitutional. Or the constitutionality of any provision
is to be challenged, a suit is open. A writ of certiorari may include a direction for refund if the
claim is clearly within the time prescribed by the Limitation Act. But, it is not a compulsory
remedy to replace a suit.
(5) Where the particular Act contains no machinery for refund’ of tax collected in excess of
constitutional limits or illegally collected a suit lies.
(6) Questions of the correctness of the assessment apart from its constitutionality are for. The
decision of the authorities and a civil suit does not lie if the orders of the authorities are declared
to be final or there is an express prohibition in the particular Act. In either case the scheme of the
particular Act must be examined because it is a relevant enquiry.
(7) An exclusion of the jurisdiction of the Civil Court is not readily to be inferred unless the
conditions above set down apply.
In the light of these conclusions we have to see how the present case stands. Section 3 was the
charging section. It spoke of the incidence of the tax. In consisted of several sub-sections. These
sub-sections laid the tax on dealers according to their tax able turnover and in the case of a
dealer who imported goods into Madhya Bharat the taxable turnover was Rs. 5000/-. Section 4
made certain exclusions and exemptions, and section 5 prescribed the rate of tax. That section
read “5(1) the tax payable by a dealer under this Act shall be at a single point and shall not be
less than Rs. 1-9-0 per cent. Or more than 6 1/4 per cent of the tax able turnover, as notified
from time to time by the Government by publication in the official gazette.
Provided that Government may in respect of special class of goods charge tax up to twelce and a
half percent on the taxable turnover.

CONCLUSION
The precedents laid down by the judicial authorities clearly establish a general rule that despite
the existence of special authorities for the adjudication of disputes arising under a particular
statute, the jurisdiction of civil courts to adjudicate the same cannot be barred. Section 9 of CPC
substantiated by various precedents to that effect, has conferred wide powers on the civil courts
enabling the courts to entertain disputes falling within the exclusive jurisdiction of a special
authority. For instance, where the special authority so constituted fails to deliver proper justice or
unless expressly or impliedly barred, the civil courts can very well entertain such matters.
As very well established by the recent ruling of the Delhi HC, the civil court can now exercise its
jurisdiction upon matters relating to Sections 397 and 398 of the Act where a question of
common law is also under dispute. The powers conferred on civil courts are wide enough so as
to enable them to keep a check on such special authorities constituted under a particular statute.
Thus complete exclusion of civil courts from exercising jurisdiction over matters falling within the
jurisdiction of a special authority under a specific statute is a far-fetched possibility, which is
expected not to be favoured by the judiciary for preserving the efficacy of the proper functioning
of the judicial and quasi-judicial authorities.

Hierarchy :
Ujjain District court
High Court MP (indore bench)
SC