TMI Blog2019 (3) TMI 1801X X X X Extracts X X X X X X X X Extracts X X X X ..... court before that stage would be premature. Jurisdiction to entertain petition - HELD THAT:- Ordinarily, a writ court would not exercise its discretionary jurisdiction to entertain a writ petition questioning a notice to show cause unless the same, inter alia, appears to have been issued without jurisdiction - In very rare and exceptional cases, the High Court can quash a show-cause notice if it is found to be wholly without jurisdiction. A showcause notice does not give rise to any cause of action as it does not amount to an adverse order which affects the rights of any party. It is quite possible that, after considering the reply to the show-cause notice, the authority concerned may drop the proceedings and/or hold that the allegations are not established. A show-cause notice does not infringe the rights of anyone. It is only when a final order, otherwise adversely affecting a party, is passed that the said party can be said to have any grievance. The jurisdiction of the High Court, under Article 226 of the Constitution, should not be permitted to be invoked in order to challenge a show-cause notice unless, accepting the facts in the show-cause notice to be correct, the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... necessary for us to take note of the contents of the assessment order passed by the Assessing Authority. 3. The appellants-writ petitioners, through their commission agents, purchased mentha oil and peppermint oil from agriculturists/farmers in the State of Uttarakhand. It was their case, in the writ petition filed by them, that, in terms of the agreement executed by them with their commission agents, the agents were required to purchase the specified quantity of mentha oil, at the prevailing market rate, as intimated by the principal from time to time, for and on behalf of the principal from cultivators, agriculturists, etc. on commission basis @ 50 paisa per kg, and to dispatch the same to the destination of the principal as per his directions; and the principal was to make a lump sum payment in advance by means of a bank draft, bank transfer to the commission agent against the said purchase as per the requirement. 4. The agreement, on which the appellants place reliance upon, also required the principal to provide empty drums etc. to the commission agents for filling the abovementioned oil; if the drums were not available with the principal, the agent was required to purch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their case. Aggrieved thereby the present appeals. 7. A Division Bench of this Court, by its order in SPA No. 54 of 2014 dated 14.3.2014, granted stay of the judgment and order under appeal; and directed the parties to maintain status quo till the appeal was heard. As a result of the interim order passed by the Division Bench, the Assessing Authority has not taken any further action pursuant to the notice issued by him under Section 28(2) read with Section 25(6) of the Uttarakhand VAT Act 8. Before us Sri S.K. Posti, learned Counsel for the appellants-writ petitioners, would submit that the notice dated 5.7.2013 was addressed to the principals, all of whom were carrying on business outside the State of Uttarakhand; Section 3 of the VAT Act is the charging section, and must strictly be construed; under Section 3(1), it is only sales, made within the State, which can be subjected to tax under the VAT Act; Section 3(2) deals with registered dealers, and those liable to be registered; since the appellants-writ petitioners are not carrying on any business within the State, they are not liable to be registered, and as such Section 3(2) has no application to their case; Section 3(3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 3(D) of the U.P. Trade Tax is in pari materia with Section 3(10) of the Uttarakhand VAT Act, and in the light of the judgment of the Allahabad High Court in Commissioner of Sales Tax, U.P. v. Hanuman Trading Company, 1979 (43) STC 408, affirmed by the Supreme Court in Commissioner of Sales Tax, U.P. Others v. M/s Bakhtawar Lal Kailash Chand Arhti Others, (1992) 3 SCC 750, the impugned show-cause notice is without jurisdiction and is liable to be set aside. 9. Shri S.K.Posti, learned Counsel, would rely on the judgments of the Supreme Court in State of A.P. v. National Thermal Power Corporation Ltd Others, (2002) 5 SCC 203; M/s Kelvinator of India Ltd. v. The State of Haryana, (1973) 2 SCC 551; and Hyderabad Engineering Industries v. State of Andhra Pradesh, (2011) 4 SCC 705 in support of his submission that the subject transaction falls within the ambit of Section 3(a) of the CST Act. He would place reliance on the judgment of the Supreme Court, in Mahaluxmi Rice Mills Others v. State of U.P. Others (1998) 6 SCC 590, in support of his submission that, in the light of the proviso to Section 3(10)(b) of the Uttarakhand VAT Act, the Assessing Authority can only procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on it was held in favour of the assessee. It is on the basis of the facts, as noted in these orders, did the learned Single Judge of the Allahabad High Court examine the question whether or not the transaction was an inter-State falling within the ambit of Section 3(a) of the CST Act. The observations, by the learned Single Judge of the Allahabad High Court, in Hanuman Trading Company were made on the revisional authority referring certain questions of law for the opinion of the Allahabad High Court, and not in writ proceedings under Article 226 of the Constitution of India. 13. Unlike in Hanuman Trading Company, the appellants-writ petitioners herein have straightway invoked the jurisdiction of this Court against the show-cause notice contending that since, according to them, the transaction was in the course of inter-State trade and commerce, and was not an intra-State sale/purchase liable to tax under the Uttarakhand VAT Act, the show-cause notice, issued by the Assessing Authority, was without jurisdiction. 14. It would be wholly inappropriate for us, in the exercise of the extraordinary jurisdiction under Article 226 of the Constitution of India, to adjudicate questions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he initial jurisdiction of the authority/Tribunal to deal with jurisdictional facts should be circumvented and the decision, on such a preliminary issue, sought before a High Court in its writ jurisdiction. (Express Newspapers (P) Ltd. v . Workers: AIR 1963 SC 569, Divisional Forest Officer v. M. Ramalinga Reddy). However, the self-imposed restrictions on the High Court not to entertain a writ petition, if another effective and efficacious remedy is available, will not operate as a bar where the order or proceedings are wholly without jurisdiction. (Whirlpool Corpn. v. Registrar of Trade Marks: (1998) 8 SCC 1). 17. In very rare and exceptional cases, the High Court can quash a show-cause notice if it is found to be wholly without jurisdiction. A showcause notice does not give rise to any cause of action as it does not amount to an adverse order which affects the rights of any party. It is quite possible that, after considering the reply to the show-cause notice, the authority concerned may drop the proceedings and/or hold that the allegations are not established. A show-cause notice does not infringe the rights of anyone. It is only when a final order, otherwise adversely affect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted the appellants-writ petitioners to the remedy of filing a reply to the show-cause notice. Interference, in an intra-Court appeal, would be justified only if the order under appeal suffers from a patent illegality. The order under appeal does not suffer from any such infirmity. Consequently, the appeals fail and are, accordingly, dismissed. However, in the circumstances, without costs. 22. Since the time stipulated by the learned Single Judge has already expired, suffice it to permit the appellants-writ petitioners to file their reply to the show-cause notice within 30 days from today. In case, they file their reply within the aforesaid period, the Assessing Authority shall consider the objections raised by them, in their reply to the show-cause notice, and pass a reasoned order in accordance with law. Till such orders are passed by the Assessing Authority, on receipt of the appellants-writ petitioners reply to the show-cause notice, no coercive steps shall be taken for recovery of the amounts mentioned in the show-cause notice. It is made clear that, in case the appellants-writ petitioners do not submit their reply to the show-cause notice within 30 days from today, it is o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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