2000 (12) TMI 876 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Quashing of the notice issued by the Excise and Taxation Officer-cum-Assessing Authority.
2. Jurisdiction of the State Government to levy tax on paddy purchased for export.
3. Maintainability of the writ petition due to the availability of an alternative remedy of appeal.
4. Effectiveness of the alternative remedy under Section 39 of the Haryana General Sales Tax Act, 1973.

Detailed Analysis:

1. Quashing of the Notice:
The petitioner sought the quashing of a notice issued by the Excise and Taxation Officer-cum-Assessing Authority, Karnal, which proposed to levy tax, interest, and penalty on the purchase of paddy under Section 28-B of the Haryana General Sales Tax Act, 1973. The petitioner argued that the transaction was exempt from tax under Sections 5(3) and 15(ca) of the Central Sales Tax Act, 1956, as the rice milled from the paddy was exported out of India.

2. Jurisdiction to Levy Tax:
The petitioner contended that the State Government lacked jurisdiction to levy tax on the paddy purchased because the rice produced from it was exported, making the transaction exempt under the Central Sales Tax Act, 1956. However, the respondents argued that the petitioner had not paid purchase tax for several years and that the impugned notice was part of a provisional assessment process.

3. Maintainability of the Writ Petition:
The respondents raised a preliminary objection regarding the maintainability of the writ petition, citing the petitioner's failure to avail of the statutory alternative remedy of appeal under Section 39 of the 1973 Act. The court emphasized that the High Court generally refrains from entertaining petitions under Article 226 of the Constitution if an effective alternative remedy is available. This principle is particularly enforced in tax matters to ensure that the statutory procedures are followed.

4. Effectiveness of Alternative Remedy:
The petitioner argued that the alternative remedy of appeal under Section 39 of the 1973 Act was not effective because the payment of the assessed tax amount was a condition precedent for the appeal. The court, however, held that the requirement to deposit the tax amount does not render the appeal ineffective. The court cited several precedents, including Titaghur Paper Mills Co. Ltd. v. State of Orissa and Assistant Collector of Central Excise, Chandan Nagar, West Bengal v. Dunlop India Ltd., to support the principle that alternative remedies must be exhausted before invoking the High Court's jurisdiction under Article 226.

The court also addressed the petitioner's reliance on prior judgments where the High Court entertained petitions despite the availability of alternative remedies. The court distinguished these cases, noting that they involved specific circumstances that justified bypassing the alternative remedies.

Conclusion:
The writ petition was dismissed, with the court directing the petitioner to avail of the alternative remedy of appeal under Section 39 of the 1973 Act. The court also instructed that if the petitioner files an appeal within four weeks, it should be entertained and decided on its merits, subject to statutory conditions. The application for exemption under the first proviso to Section 39(5) of the 1973 Act should be considered independently of the observations made in this judgment.

Writ petition dismissed.