2005 (11) TMI 452 - HC - VAT and Sales Tax

Summary

Issues:
Assessment orders passed by taxing authority without hearing the assessees and review of assessment orders under discretionary powers of the court.

Analysis:
The judgment pertains to four writ petitions heard together concerning identical legal issues. The petitioners, registered dealers under the Assam General Sales Tax Act, 1993, engaged in the inter-State trade of tea, faced disputes regarding turnovers for the year 2001-02. The taxing authority issued notices demanding taxes without providing an opportunity to the assessees to present their books of account, leading to the petitioners approaching the High Court challenging the assessment orders.

The central question in these cases was whether the court could review assessment orders passed by the taxing authority under the discretionary powers of Article 226, especially when the assessees had not utilized the alternative remedy available through appeal. The petitioners argued that they were not given sufficient time to produce the required documents and that the assessment was solely based on the report of the Area Inspector of Taxes.

The Additional Advocate-General contended that the assessees had been given ample opportunities to comply with the requirements, and their inaction led to the taxing authority levying taxes as per his best judgment. The court noted that the assessees had failed to furnish the necessary declarations within the prescribed time, and their conduct was deemed negligent and callous.

The court emphasized the importance of exhausting statutory remedies before seeking judicial intervention, citing provisions for appeal in the concerned Act. It was held that the assessees' failure to act in accordance with the law and their disregard for the taxing authority's directives precluded them from seeking relief through writ petitions. The court referenced relevant case laws to support its decision, highlighting that judicial review is limited to examining the decision-making process and not the correctness of the decision itself.

Ultimately, the court disposed of the writ petitions, directing the petitioners to pursue the alternative remedy of approaching the appellate forum within three weeks. The taxing authority was restrained from taking coercive measures for recovery during this period, emphasizing the importance of adhering to statutory procedures before seeking judicial intervention.