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M/s. New Saravana Stores Bramandamai Versus The Assistant Commissioner (CT)

2017 (11) TMI 468 - MADRAS HIGH COURT

Revision of deemed assessments - sale of used car inside the state of Tamil Nadu - rectification of error - Jurisdiction of Stae to levy tax in inter-state sale - maintainability of petition - Held that: - Though, the appellant has contended that it was only an error apparent on the face of the record, upon consideration of the material on record, writ Court, vide common order made in W.P.Nos.21169 to 21171 of 2017, has observed that the income tax certification, holds good only for the purpose .....

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estion of jurisdiction, can always be raised before the concerned authorities. - Common order of the writ Court made in W.P.Nos.21169 to 21171 of 2017 dated 09.08.2017, directing the appellant to avail the alternate remedy provided under the statute, cannot be said to be manifestly illegal warranting interference - petition dismissed being not maintainable. - W.A.Nos.1360 to 1362 of 2017 and CMP No.18806 to 18808 of 2017 - Dated:- 3-11-2017 - S. Manikumar And R. Suresh Kumar, JJ. For the Ap .....

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modity under the 5% category pertaining to the sales of used cars at 5% and it was inadvertently coupled alongwith other goods. Claiming the same as clerical error in the submission of the returns, petitions dated 31.03.2017 have been filed by the assessee under Section 84 of the Tamilnadu Value Added Tax Act, 2006 for rectification before the Assistant Commissioner (CT), Pondy Bazaar Assessment Circle, Chennai, the respondent herein. 2. Before the said authority, contentions were also made that .....

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uated outside the State and the relevant tax was borne at the point of first sale and thereafter the sale of the used cars was effected by the partner to a dealer outside the State of Puducherry, which is an interstate sale simplicitor. Thus, it was contended that practically there was no jurisdiction for the sufferance of tax inside the State of Tamil Nadu. Further, the appellant has contended that the returns filed by the dealer disclosing the used car sales as taxable @ 5% was unwarranted and .....

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de the petitions filed for rectification, on merits and in accordance with law, separate orders dated 16.06.2017, have been passed in the rectification petitions for the assessment years 2013-14, 2014-15 and 2015-16. 4. When correctness of the abovesaid orders were challenged, in W.P.Nos.21169 to 21171 of 2017, writ Court by adverting to the grounds of challenge and submissions, mainly, on jurisdiction of Government of Tamilnadu to levy tax, taking note of the facts and the alternative remedy pr .....

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titioner that certification holds good only for the purpose of income-tax assessment is not acceptable. Prima facie, this Court is of the view that such a finding recorded by the respondent is correct. Nevertheless, the matter involves appreciation and re-appreciation of the factual position, especially when the deemed assessments have taken place at the instance of the petitioner who filed the returns duly supported by Form-WW Certificates by a Chartered Accountant. Therefore, this Court cannot .....

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medy available to the petitioner. 10. Thus for the above reasons, the preliminary issue is decided against the petitioner and it is held that the writ petitions are not maintainable." 5. Instant writ appeals have been filed against the said orders. Inviting the attention of this Court to the preamble of the Tamilnadu Value Added Tax Act, 2006 that, it is an Act to consolidate and amend the law relating to the levy of tax on the sale or purchase of goods in the State of Tamilnadu, explanatio .....

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batore and another and another decision in Tax Case (Appeal) No.125 of 2007 dated 13.02.2014 in the matter of M/s.CRN Investments (P) Limited Vs. the Commissioner of Income Tax, Chennai, Mrs.R.Hemalatha, learned counsel for the appellant submitted that there is an error apparent on the face of the record, when the appellant by mistake, submitted the returns and when State has no jurisdiction to levy tax for the sale effected outside the State of Tamilnadu, there being a jurisdictional error, wri .....

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ll as this Court, held that when there is an effective and alternate remedy, provided under the taxing laws, writ petitions, should not be entertained. Reference can be made to few decisions, in this regard. (i). In Union of India v. T.R.Verma, AIR 1957 SC 882, the Hon'ble Supreme Court held that it is well settled that when an alternative and equally efficacious remedy is open to a litigant, he should be required to pursue that remedy and not to invoke the special jurisdiction of the High C .....

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he statute, the party must exhaust the statutory remedies before resorting to writ jurisdiction. (iii) The general principles of law to be followed while entertaining a writ petition, when an alternative remedy is available, as per the decision of the Hon'ble Apex Court in U.P.State Spinning Co. Ltd. Vs. R.S.Pandey and Another (2005) 8 SCC 264, at para No.11 are as follows: "Except for a period when Article 226 was amended by the Constitution (Forty-Second Amendment) Act, 1976, the powe .....

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normally the High Court should not interfere if there is an adequate efficacious alternative remedy. If somebody approaches the High Court without availing the alternative remedy provided, the high Court should ensure that he has made out a strong case or that there exist good grounds to invoke the extraordinary jurisdiction." (iv) In United Bank of India Vs. Satyawati Tondon and Others {(2010) 8 SCC 110}, the Hon'ble Apex Court, at paragraph Nos.43 to 45, held as follows:- 43. Unfortu .....

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blic dues, etc., the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they do not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the high Court must insist that before availing remedy under Article 226 of the Constitution, a person .....

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rcise of that power but, at the same time, we cannot be oblivious of the rules of self-imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution. 45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, but it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution and pass inter .....

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rights or where there has been a violation of the principles of natural justice or where the order under challenge is wholly without jurisdiction or the vires of the statute are under challenge. The Court has recognised some exceptions to the rule of alternative remedy. However, the high Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been tak .....

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tment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in Thansingh Nathmal Case {Thansigh Nathmal Vs. Supt. of Taxes, AIR 1964 SC 1419}, Titaghur Paper Mills Case {Titaghur Paper Mills Co. Ltd Vs. State of Orissa (1983) 2 SCC 433} and other similar judgments that the High Court will not en .....

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e assessment/reassessment of tax, imposition of penalty and for obtaining relief in respect of any improper orders passed by the Revenue Authorities, and the assessee could not be permitted to abandon that machinery and to invoke the jurisdiction of the High Court under Article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Commissioner of Income Tax (Appeals). The remedy under the statute, however, must be effective and not a mere formality with no substanti .....

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atisfactory reasons to have exercised its jurisdiction in the facts of the instant case. In light of the same, we are of the considered opinion that the writ Court ought not to have entertained the writ petition filed by the assessee, wherein he has only questioned the correctness or otherwise of the notices issued under Section 148 of the Act, the reassessment orders passed and the consequential demand notices issued thereon. 18. In view of the above, we allow this appeal and set aside the judg .....

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llate authority shall consider the petition only on merits without any reference to the period of limitation. However, it is clarified that the appellate authority shall not be influenced by any observation made by the High Court while disposing of Writ Petition (Civil) No.44 of 2009, in its judgment and order dated 5/10/2010." (vii) After considering a plethora of judgments, in Union of India and Others Vs.Major General Shri Kant Sharma and Another {(2015) 6 SCC 773}, at para36, the Apex C .....

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of India (1990) 4 SCC 594. (ii). The jurisdiction of the High Court under Article 226 and this Court under Article 32 though cannot be circumscribed by the provisions of any enactment, they will certainly have due regard to the legislative intent evidenced by the provisions of the Acts and would exercise their jurisdiction consistent with the provisions of the Act (Refer: Mafatlal Industries Ltd., Vs. Union of India (1997) 5 SC 536. (iii). When a statutory forum is created by law for redressal .....

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ators Assn. of India (2011) 14 SCC 337.)" (viii) In Veerappa Pillai Vs. Raman & Raman Ltd {1952 SCR 583}, CCE Vs. Dunlop India Ltd {(1985) 1 SCC 260}, Ramendra Kishore Biswas Vs. State of Tripura {(1999) 1 SCC 472, Shivgonda Anna Patil Vs. State of Maharashtra {(1999) 3 SCC 5}, C.A.Abraham Vs. ITO {(1961) 2 SCR 765}, Titaghur Paper Mills Co Ltd., Vs. State of Orissa {(1983) 2 SCC 433}, H.B.Gandhi Vs. Gopi Nath & Sons {1992 Supp (2) SCC 312}, Whirlpool Corpn Vs. Registrar of Trade Ma .....

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record, writ Court, vide common order made in W.P.Nos.21169 to 21171 of 2017, has observed that the income tax certification, holds good only for the purpose of income tax assessment. Writ Court has also observed that when the deemed assessment have taken place, at the instance of the petitioner, who had filed the returns, duly supported by Form-WW Certificates by a Chartered Accountant, writ Court cannot embark upon a fact-finding exercise to examine the correctness of the stand taken by the re .....

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