1995 (1) TMI 359 - HC - VAT and Sales Tax

Summary

Issues:
Petition seeking quashment of sale proceedings, assessment orders, and penalty order. Existence of alternative remedy and forum for challenging orders.

Analysis:
The petitioner filed a petition under Article 226 of the Constitution seeking quashment of sale proceedings, assessment orders, and penalty order. The respondents had assessed the firm "Prakash Trading Company" and initiated action against the petitioner as a partner of the defaulting firm. The respondents passed orders of assessment against the firm, seized goods belonging to the firm, and imposed a penalty due to unaccounted goods found with the petitioner. The petitioner challenged the assessment order against the firm, seizure of goods, and the penalty order. The goods were treated as perishable and directed to be sold under the supervision of the sales tax authority, with the sale proceeds retained by the Sales Tax Department pending disposal of the petition.

The petitioner informed the court that the assessment order against the firm had been quashed by a superior authority and remitted back for fresh assessment. An application seeking a refund of the recovered amount was pending before the Commissioner. The petitioner also mentioned that the penalty order was challengeable under the Act, but the limitation period had expired. The Government Advocate opposed the petition citing the existence of an alternative remedy and forum for redressal.

Referring to a legal precedent, the court noted that when a statutory forum is created for specific grievances, the High Court should not entertain petitions under Article 226. In response to the preliminary objection, the petitioner requested the Commissioner to decide on the refund application and sought an extension of the limitation period to challenge the penalty order. The court allowed the preliminary objection and issued directions for the Commissioner to decide on the application within three months and granted the petitioner one month to resort to an alternative remedy against the penalty order without contesting on the grounds of limitation.

The court disposed of the petition with directions for the Commissioner to decide on the application, allowing the petitioner to pursue an alternative remedy against the penalty order within a specified time frame. The authority handling the proceedings was instructed to pass appropriate orders regarding the sale proceeds in accordance with the law. The petition was finally disposed of with no orders as to costs.