2006 (6) TMI 492 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to notice calling for objection on proposed tax levy for certain purchased items falling under the Third Schedule of TNGST Act, 1959.

Analysis:
The writ petition sought a writ of certiorarified mandamus to quash a notice proposing a tax levy on turmeric powder, chillies, coriander, and tamarind purchased by the petitioner for own consumption. The issue revolved around the proposed levy on items falling under the Third Schedule of the Tamil Nadu General Sales Tax Act, 1959. The assessing officer justified the levy based on purchases made without earlier tax sufferance, totaling Rs. 30,18,321. The petitioner's turnover was below Rs. 300 crores, but the exemption was not extended to purchasers under section 7A of the Act. The court emphasized that objections raised in the writ petition could be presented before the assessing officer for early adjudication or through appeal mechanisms, citing the Supreme Court dictum in Union of India v. Tata Engineering & Locomotive Co. Ltd.

The court highlighted the importance of allowing the assessing officer to complete the assessment as deemed fit, with the option for the assessee to appeal any discrepancies. Referring to the case law in Muthuraja Traders v. Deputy Commercial Tax Officer, the court stressed that interference in fiscal matters should be minimal unless a grave miscarriage of justice is evident. The judgment underscored that challenging a notice prematurely through a writ petition is discouraged, advising the petitioner to file objections as per the notice's requirement within an extended timeframe.

Additionally, the court referenced the Supreme Court's decision in State of Goa v. Leukoplast (India) Ltd., emphasizing the importance of exhausting statutory remedies before approaching the court with writ petitions. Ultimately, the court dismissed the writ petition as premature, granting the petitioner an additional 20 days to file objections to the impugned notice. The judgment concluded by dismissing the writ petition and the connected miscellaneous petition, without imposing costs.