1952 (4) TMI 31 - HC - VAT and Sales Tax

Summary

Issues:
- Application for writ of prohibition against sales tax assessment for 1950-51
- Interpretation of rules regarding the place of business for sales tax purposes
- Retrospective application of amended rule defining place of business
- Availability of adequate remedy under the Madras General Sales Tax Act

Analysis:
The petitioner, a merchant trading in bullion and specie, sought a writ of prohibition against the sales tax assessment for 1950-51. The dispute arose from the interpretation of rules regarding the place of business for sales tax purposes. The petitioner contended that the villages or towns where he casually sold bullion were not places of business as per the Madras General Sales Tax Rules, 1939. Additionally, the petitioner argued that the amended rule defining the place of business should not have retrospective application. The learned Government Pleader, supporting the Sales Tax Authorities, argued that the petitioner had an adequate remedy under the Act itself, making the writ unnecessary. The judge accepted the preliminary objection raised by the respondent, thereby avoiding the need to express a view on the petitioner's contentions.

The Madras General Sales Tax Act provides a comprehensive framework for assessment and appeals, creating a hierarchy of Tribunals for adjudication of disputes related to tax assessments. The Act outlines procedures for submitting returns, assessment of turnover, and avenues for appeal against assessments. The Act also empowers various authorities to review orders and pass appropriate orders to ensure the legality and propriety of assessments. The petitioner's attempt to bypass the statutory procedure by seeking a writ of prohibition was deemed inappropriate by the judge. The judge emphasized that the Act offers effective and satisfactory remedies for aggrieved parties, including the right to appeal and seek directions regarding tax payment from the Tribunals.

In dismissing the petition, the judge highlighted that the availability of statutory remedies under the Act precluded the need for invoking the extraordinary jurisdiction of the Court. The judge underscored that the interpretation of the Sales Tax Act and its rules falls within the jurisdiction of the Tribunals established by the Act. The judge rejected the petitioner's argument that delay or financial burden associated with the statutory remedies justified seeking a writ of prohibition. Despite acknowledging potential difficulties faced by the petitioner, the judge emphasized that the Act provides a robust mechanism for addressing grievances related to tax assessments. The petition was dismissed with costs, emphasizing the availability of remedies under the Madras General Sales Tax Act.