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TMI Blog2005 (4) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... th the provisions contained in the Sales Tax Act and reporting the sales turnover to the assessing authorities from time to time. In effect, the submissions of the petitioners is that they have been conducting the business in accordance with law. The assessments for the years 2002-03, 2003-04, 2004-05 were also completed by the assessing authorities and the assessments have become final. 4.. While so, the business premises of the petitioners was inspected by the first respondent-Commercial Tax Officer, Krishna Lanka Circle, Vijayawada and seized the entire books of accounts. It is also alleged that the first respondent recorded the statement of the staff under the threat and coercion. Similar inspections were also conducted in all the branches on March 18, 2005 and seized the books of accounts and other documents. They did not even furnished acknowledgement of the seizure of various books of accounts. The petitioners submit that the inspection was conducted on the instructions of the fourth respondent-Commissioner of Commercial Taxes. Even inspection was conducted only in the showrooms and that the actual stocks lying in the godowns and available with the sub-dealers were not tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, four found to have been suppressed the purchases. Out of four, three petitioners are the petitioners before this Court and the other distributor has paid the tax to the department without any dispute. It is also stated that no incriminating material is relied upon and what all information furnished from Honda Motors has been furnished in the show cause notice served on the petitioner. It is denied that the books of accounts and invoices and floppies were seized and it is stated that certain branches Ongole, Piduguralla and Guntur were kept in the custody for verification. The respondents tried to establish that there was suppression of purchases and even imposing tax. We find it inappropriate at this point of time to go into the merits of the case as the matter is only at the stage of show cause notice. 8.. The question that calls for consideration is whether the show cause notice issued is sustainable? 9.. The learned counsel appearing for the petitioners vehemently submits that the issuance of the show cause notice cannot be treated as of routine requirement, but it has several ramifications. There are no grounds to initiate the reassessment proceedings. When once th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1958] SCR 595; AIR 1958 SC 86, as under (at P. 93 of AIR): But this rule requiring the exhaustion of statutory remedies before the writ will be granted is a rule of policy, convenience and discretion rather than a rule of law and instances are numerous where a writ of certiorari has been issued in spite of the fact that the aggrieved party had other adequate legal remedies. 18.. This proposition was considered by a Constitution Bench of this Court in A.V. Venkateswaran, Collector of Customs, Bombay v. Ramchand Sobhraj Wadhwani AIR 1961 SC 1506 and was affirmed and followed in the following words (para 10): 'The passages in the judgments of this Court we have extracted would indicate (1) that the two exceptions which the learned SolicitorGeneral formulated to the normal rule as to the effect of the existence of an adequate alternative remedy were by no means exhaustive and (2) that even beyond them a discretion vested in the High Court to have entertained the petition and granted the petitioner relief notwithstanding the existence of an alternative remedy. We need only to add that the broad lines of the general principles on which the court should act having been clearly la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt reported in Tarlochan Dev Sharma v. State of Punjab (2001) 6 SCC 260. The Supreme Court observed in para 12 thus: "One of the requirements of the principles of natural justice, as incorporated in second proviso to section 22, is that the reasons for the proposed removal have to be communicated to the person proceeded against. The purpose of such communication is to enable him to furnish an explanation of his conduct or his act or omission which is likely to be construed as an abuse of power. It is clear that the facts constituting gravamen of the charge have to be communicated. It follows as a necessary corollary therefrom that what has not been communicated or not relied on in the show cause notice as a ground providing reason for the proposed removal cannot be relied upon as furnishing basis for the order of removal. The person proceeded against under section 22 of the Act has to be made aware of the precise charge which he is required to meet and, therefore, he must be apprised of the exact content of the abuse of power attributed to him. The authority taking decision must apply its mind also to the explanation furnished by the person proceeded against and this must app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch 18, 2005 in GI No.2652/ 2004-2005, it is stated as follows: "As against this the dealer-company recorded a sales turnover of Rs. 8,28,48,901 only up to March 12, 2005 during the year 200405 as per the statement furnished by the dealer-company at the time of inspection. Therefore, the dealer-company has clearly suppressed first sales of motor cycles and evaded tax due thereon." 13.. Similarly, in other show cause notice issued to Associated Auto Service, the first respondent in GI No. 1437/2002-03, dated March 18, 2005 observed as follows: "While the purchases of motor cycles from outside the State are Rs. 19,89,19,981 as per the extracts, the dealer disclosed the purchases of motor cycles from outside the State as Rs. 2,82,67,788 only in the trading account. The dealer therefore, suppressed the first purchases of motor cycles to the tune of Rs. 17,06,52,193 in the year 2002-03. The dealer disclosed a closing stock of outside the State purchase motor cycles as Rs. 1,59,26,765. In view of the fact that the dealer suppressed the purchases of motor cycles from outside the State, the books of accounts, the trading account prepared on the basis of the books of acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered basing on the material furnished in the explanation. But, in the instant case, we are required to scrutinise the contents of the show cause notice with reference to the reassessment process. The reasons for forming an opinion to initiate reassessment proceedings appear to be based on the information obtained from the manufacturer, but that material was not furnished to the petitioner at all. When the assessment is sought to be reopened, necessary material has to be furnished to the petitioner warranting reassessment. In the instant case, even according to the respondents, the assessment is sought to be reopened only on the basis of the uncommunicated information behind and back of the petitioners from the manufacturer and the mind of the assessing authority has already been indicated in the show cause notice itself and the first respondent has virtually come to a definite conclusion to levy the tax on the premise that the petitioner suppressed the purchases. Further, the first respondent went a step further indicating that penalty proceedings will also be initiated. Under those circumstances the first respondent has recorded a definite finding of facts without there being ..... X X X X Extracts X X X X X X X X Extracts X X X X
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