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TMI Blog2023 (5) TMI 1330X X X X Extracts X X X X X X X X Extracts X X X X ..... 19.03.2019 is barred by limitation for the tax period April, 2014 to January, 2015 and the Assessment proceedings are also in violation of principles of natural justice, and also to set aside the garnishee notice dated 20.03.2023 issued by the 2nd respondent to the 5th respondent for recovery of balance of disputed tax of Rs. 38,03,561/-, pursuant to the dismissal orders referred supra. 2. Petitioner is a partnership firm engaged in export of Resins Osides and other chemicals and registered as an assessee on the rolls of the 2nd Respondent under Andhra Pradesh Value Added Tax Act, 2005 (for short 'A.P. VAT Act') and Central Sales Tax Act, 1956 (CST Act). During tax period 20014-15, the petitioner effected direct export sales of Micro Silican, an exempted commodity under Section 5 of the CST Act. The petitioner submitted Form VAT 200 in Form CST/VI through online for the assessment year 2014-15. The 2nd respondent/Assessing Authority having scrutinized the forms and accounts, found that the petitioner failed to file statutory forms such as C-EI-E2-F to claim concessional rate of tax at the rate of 2% or to claim exemptions under Interstate transactions, ultimately arrived at the gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccount for recovery of balance of disputed tax of Rs. 38,03,560/- since half of the tax was already paid by the petitioner at the time of admission of appeal before the 3rd respondent and admission of the second appeal before the APVAT Appellate Tribunal. Hence, the Writ Petition. 7. The grounds on which the writ petition is filed are: i) The proceedings of the 2nd respondent dated 19.03.2019 is patently barred by limitation for the tax period from April, 2014 to January, 2015 as per sub- rule (5A) of Rule 14A of the CST (AP) Rules, 1957. It is passed without granting personal hearing and alleged to have been e-mailed, which is in violation of principles of natural justice and passed ex-parte; contrary to Section 9(2) of the CST Act read with Rule 25 (5) of the AP VAT Rules; ii) The disputed turnover is related to direct export sales of Micro Silica, which is exempted from tax under Section 5 (1) of the CST Act; iii) The petitioner received orders passed by the 2nd respondent under the CST Act for the tax period 2015-16, dated 15.11.2019, 2016-17, dated 15.03.2021 in the same address but for the period of 2014-15, which is in dispute in the present case could not be served n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndo aliquid prohibetur, prohibetur at omne per quod devenitur ad illud", which means" "whenever a thing is prohibited, it is prohibited whether done directly or indirectly". xii) The 2nd respondent ought to have considered the application of the petitioner dated 18.12.2019 by rectifying the mistake apparent on the record as per Rule 14A sub-rule (10) of CST (AP) Rules, 1957 and also Rule 60 of the A.P. VAT Rules, the 2nd respondent oughtto have considered the representation of the petitioner dated 18.12.2019. xiii) The 3rd respondent-Appellate Deputy Commissioner passed order, which is contrary to Section 31 (4) of A.P. VAT Act read with Section 9(2) of the CST Act; xiv) The petitioner further says that he has not collected the disputed tax, if compelled to pay the same, he will be put to severe loss and hardship, more particularly, the transactions are squarely covered by Section 5 (1) of the CST Act. Arguments advanced at the Bar: 8. Heard Sri C. Sanjeeva Rao, learned counsel appearing for the petitioner and the learned Government Pleader for Commercial Tax. With their consent, the writ petition is disposed of at the admission stage. 9. Learned counsel for the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine Consumer Health Care Limited (In short "Glaxo case") (2020) 19 SCC 681. The question before the Hon'ble Supreme Court emanated from the judgment and order passed by the High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh in W.P. No. 31418 of 2018 is whether the High Court, in exercise of its writ jurisdiction under Article 226 of the Constitution of India, can entertain a challenge to the assessment order on the ground that the statutory remedy of appeal against that order stood foreclosed by the law of limitation. 16. For better understanding of the issue, the facts of the case are that M/s. Glaxo is a registered dealer was assessed to tax for the assessment year 2013-2014 under the impugned assessment Order dated 21.06.2017. The Assessment Order was duly served on the respondent on 22.06.2017. M/s. Glaxo deposited 12.12% of the disputed tax on 12.09.2017, but did not file appeal against the Assessment Order within the statutory period. Thereafter, an application was filed under Rule 60 of A.P. VAT Act, 2005 on 08.05.2018 before the Assessing Authority which was rejected on 11.05.2018. 17. M/s. Galxo carried the matter in appeal b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition filed by M/s. Glaxo. The Hon'ble Apex Court observed at various paragraphs as follows; Para-15: In the subsequent decision in Mafatlal Industries Ltd, and others v. Union of India & Ors. (1997) 5 SCC 536, this Court went on to observe that an Act cannot bar and curtail remedy under Article 226 or 32 of the Constitution. The Court, however, added a word of caution and expounded that the constitutional Court would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise its jurisdiction consistent with the provisions of the enactment. To put it differently, the fact that the High Court has wide jurisdiction under Article 226 of the Constitution, does not mean that it can disregard the substantive provisions of a statute and pass orders which can be settled only through a mechanism prescribed by the statute. Para-16: Indubitably, the powers of the High Court under Article 226 of the Constitution are wide, but certainly not wider than the plenary powers bestowed on this Court under Article 142 of the Constitution. Article 142 is a conglomeration and repository of the entire judicial powers under the Constitution, to do compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Guj 97 and also of the Karnataka High Court in Phoenix Plasts Company vs. Commissioner of Central Excise (Appeal-I), Bangalore 2013 (298) ELT 481 (Kar.). The logic applied in these decisions proceeds on fallacious premise. For, these decisions are premised on the logic that provision such as Section 31 of the 1995 Act, cannot curtail the jurisdiction of the High Court under Articles 226 and 227 of the Constitution. This approach is faulty. It is not a matter of taking away the jurisdiction of the High Court. In a given case, the assessee may approach the High Court before the statutory period of appeal expires to challenge the assessment order by way of writ petition on the ground that the same is without jurisdiction or passed in excess of jurisdiction by overstepping or crossing the limits of jurisdiction including in flagrant disregard of law and rules of procedure or in violation of principles of natural justice, where no procedure is specified. The High Court may accede to such a challenge and can also non-suit the petitioner on the ground that alternative efficacious remedy is available and that be invoked by the writ petitioner. However, if the writ petitioner chooses to ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner approached the court by invoking the writ jurisdiction after expiry of the maximum period of limitation prescribed under the Act, the High Court cannot disregard the statutory period by entertaining the writ petition to attend the grievance to such a party as a matter of course. Such order under writ jurisdiction would be in the teeth of the principle enunciated by the Hon'ble Apex Court in Three Judge Bench in ONGC Corporation Limited referred supra. 25. The powers of High Court under Article 226 of the Constitution of India though wide, should be exercised with self-imposed restraint, and as such the Court cannot issue any writ which is inconsistent with the legislative intent regarding the prescribed period of limitation under Section 31 of the VAT Act, 2005, thereby making the legislative scheme and intention behind the proviso futile. The party who approaches the court under writ jurisdiction, has to substantiate the plea of "inability" to file appeal within the prescribed time. 26. Before adverting to scrutinize the Assessment order, it is profitable to look into the relevant provisions under the Act which are extracted infra. Section 9 (2) of the CST Act, which reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esidence or office or business in the State; or (iii) it is sent by registered post to such place of residence, office or business, or to the person's usual or last known address in the State; or (b) on any other person if, - (i) it is personally served on the nominated person; or (ii) it is left at the registered office of the person or the person's address for service of notices under the Act; or (iii) it is left at or sent by registered post to any office or place of business of that person in the State; Iv) where it is returned unserved, if it is put on board in the office of local chamber of commerce or traders association. (2) The certificate of service signed by the person serving the notice shall be evidence of the facts stated therein." 27. Order passed by the Assessing Authority (Second Respondent) (a) Now we shall examine the correctness of the Assessment Order passed by the 2nd respondent. The Assessment Order dated 19.03.2019 manifests that the dealer filed monthly returns online disclosing the turnover for the year 2014-15. The Assessing Authority has taken the turnover of Rs. 5,24,65,700/- separately for the purpose of finalizing the assessment under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to submit the objections on the show cause notice, right of personal hearing cannot be denied. (f) In the light of the discussion referred to supra, the order impugned passed by the second respondent is in contravention of Rule 64 of VAT Rules apart from violation of principles of natural justice. (g) Order passed by the Appellate Deputy Commissioner (3rd respondent): 28. A cursory look at the order shows that on service of the assessment order, the dealer has to prefer appeal before the 3rd respondent that is the ADC within a period of 30 days. If the dealer failed to prefer an appeal within 30 days if he is able to show sufficient cause he can prefer an appeal within further period of 30 days. (a) For ready reference Section 31 (1) of the APVAT Act reads is extracted hereunder: Section 31: Appeal to Appellate Authority:- (1) Any VAT dealer or TOT dealer or any other dealer objecting to any order passed or proceeding recorded by any authority under the provisions of the Act other than an order passed or proceeding recorded by an Additional Commissioner or Joint Commissioner or Deputy Commissioner, may within thirty days from the date on which the order or proceeding was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Learned counsel for the petitioner submits that when it came to their notice about the assessment order, they thought that somebody misplaced the order and thereby obtained assessment order from the 2nd respondent. That does not mean that the Assessment Order was served as per the provisions of the Act. In the light of the aforementioned reasons, the Order impugned passed by the third respondent is unsustainable. Order passed by the A.P. VAT Appellate Tribunal (first Respondent): 30. The 1st respondent opined that the order of the A.D.C is on correct lines since the appeal preferred beyond the condonable period of limitation. As such, the Appellate Deputy Commissioner rightly rejected the appeal. In the background of the discussion referred supra relating to the order passed by the Assessing Authority, the order impugned passed by the first Respondent is not correct, brooks interference in this Writ Petition. Furnishing 'C' forms after passing assessment order: 31. (a) The case of the petitioner is that they have done direct exports which are liable for exemption under Section 5 (1) of the C.S.T. Act. Be that as it may, on 18.12.2019, the petitioner addressed a letter to the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of appeal had expired long back in August, 2017 itself and the appeal came to be filed by the respondent only on 24.9.2018, without substantiating the plea about inability to file appeal within the prescribed time, no indulgence could be shown to the respondent at all." 34. We are not extending the period of limitation after condonable period but, in the peculiarity of the present case, since the pre-assessment notice was not served as per the procedure, we deem it fit that an opportunity shall be given to the assessee to place the material supporting direct export sales under Section 5 (1) of the C.S.T Act for claiming exemption. 35. We sum up our discussion as follows:- a. A party can approach the High Court in a writ within the statutory period of limitation challenging the assessment order, in cases where the order is passed without jurisdiction, excess of jurisdiction, being flagrant disregard of law, violative of rules of procedure and violative of principles of natural justice. b. The petitioner can be non-suited when there is an alternative and efficacious remedy available. c. The High Court cannot exercise its jurisdiction under Art. 226 of the Constitution of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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