2001 (8) TMI 1340 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to order under U.P. Trade Tax Act, 1948; Comparison with interim order in another case; Binding nature of interim orders; Necessity of ratio in a decision; Proper course of action for appeal; Validity of circular in relation to impugned order.

Analysis:
The judgment of the Allahabad High Court addressed the challenge to an order under the U.P. Trade Tax Act, 1948. The petitioner contested the cancellation of a certificate issued under section 4-B of the Act. It was noted that an appeal lay against the order, and the court emphasized the importance of following a proper course of action by preferring an appeal before invoking the extraordinary jurisdiction of the Court. The order in question was found to be within jurisdiction and compliant with principles of natural justice as notices were duly served on the petitioner.

In considering the comparison with an interim order in another case, the court highlighted the necessity for a decision to lay down a ratio to be considered a binding precedent. It was emphasized that interim orders lacking a principle of law or ratio were not binding. The court referred to legal principles from past judgments, including the significance of a decision containing reasons and principles of law to be binding on inferior courts.

The judgment also delved into the validity of a circular issued by the Commissioner of Income-tax (Trade Tax) and its relation to the impugned order. The standing counsel clarified that the impugned order was not based on the circular. The court directed the petitioner to prefer an appeal before the appellate authority within a week, ensuring disposal in accordance with the law within a month, without considering the circular. The petitioner was granted the opportunity to present submissions or evidence during the appeal process.

In conclusion, the writ petition was disposed of with the mentioned directions, and the court ordered the listing of another related matter for further proceedings. The judgment underscored the importance of following the statutory remedy of appeal before seeking extraordinary relief and clarified the non-binding nature of interim orders lacking a ratio or principle of law.