2004 (1) TMI 663 - HC - VAT and Sales Tax

Summary

Issues:
1. Entertaining a petition under article 226 against a notice issued by the assessing authority.
2. Exemption of sugar imported by the company under entry No. 56 of the Third Schedule to the Act.
3. Interference by the High Court in the assessment process.

Analysis:
1. The High Court was tasked with determining whether it was appropriate to entertain a petition under article 226 against a notice issued by the assessing authority. The company, engaged in the import and sale of commodities including sugar, filed a writ petition challenging the notice issued under the Kerala General Sales Tax Act, 1963 and the Central Sales Tax Act, 1956. The assessing officer had issued multiple notices, leading to the company filing the writ petition. The learned single Judge allowed the writ petition, quashing the notices, citing that the imported sugar fell under the exempt category. However, the High Court found that the assessing officer should have been allowed to complete the assessment, and the interference by the learned single Judge was premature.

2. The main issue revolved around the exemption of sugar imported by the company under entry No. 56 of the Third Schedule to the Act. The assessing officer had issued notices proposing to tax the imported sugar under the Act and the CST Act. The company contended that the sugar imported was exempt under entry No. 56, supported by the classification under the Central Excise Tariff Act. The learned single Judge accepted the company's claim for exemption, but the High Court emphasized that the assessing officer should have been given the opportunity to decide on the matter based on evidence presented by both parties.

3. The High Court highlighted the importance of allowing the assessing authority to complete the assessment process without premature interference by the court. The court noted that the statutory remedies available to the company, such as appeal and revision, should not have been bypassed. The assessing officer had proposed to complete the assessment after considering the company's objections, but the learned single Judge's intervention hindered this process. The High Court set aside the judgment of the learned single Judge, emphasizing the need for the assessing officer to make a decision based on all relevant contentions raised by the company in its replies to the notices.

In conclusion, the High Court allowed the appeal, set aside the judgment of the learned single Judge, and directed the assessing officer to proceed with the assessment in accordance with the law, considering all contentions raised by the company. The court emphasized the importance of allowing the assessing authority to complete the assessment process without premature interference by the court, ensuring that statutory remedies are not bypassed.