2007 (4) TMI 656 - HC - VAT and Sales Tax

Summary

Issues:
1. Availability of alternative remedy.
2. Unexplained laches in challenging the assessment order.
3. Interpretation of the liability under the Tamil Nadu Additional Sales Tax Act.
4. Jurisdiction of the respondent.
5. Challenge on the question of laches.
6. Legal issue on the chargeability of additional sales tax.
7. Direction to seek appellate remedy.

1. Availability of alternative remedy:
The writ appeal was filed against the order of the single judge who dismissed the writ petition citing the availability of an alternative remedy. The appellant, an assessee under the Tamil Nadu General Sales Tax Act, challenged the order of assessment dated April 1, 1998. The court directed the appellant to seek appellate remedy by filing an appeal within two weeks, setting aside the single judge's order.

2. Unexplained laches in challenging the assessment order:
The single judge held that there was unexplained laches on the part of the petitioner for more than six years in challenging the assessment order. The appellant had not challenged the assessment order in appeal but preferred an original petition before the Tamil Nadu Taxation Special Tribunal, which was later re-numbered as a writ petition.

3. Interpretation of the liability under the Tamil Nadu Additional Sales Tax Act:
The appellant contended that the liability under the Tamil Nadu Additional Sales Tax Act did not arise for the period August 1, 1996, to March 31, 1997, as the taxable turnover was below the threshold for additional sales tax. The respondent, however, proceeded to pass the assessment order fixing the liability under the Act.

4. Jurisdiction of the respondent:
The appellant challenged the jurisdiction of the respondent, arguing that the chargeability to the provisions under the Tamil Nadu Additional Sales Tax Act was illegal and beyond the respondent's powers. The original petition challenging the jurisdiction was admitted and pending before the Tamil Nadu Taxation Special Tribunal.

5. Challenge on the question of laches:
The appellant's counsel argued that the rejection of the prayer based on the question of laches by the court was not sustainable in law. The appellant had paid the additional sales tax before the assessment order was passed, and upon realizing the legal position, filed the original petition challenging the liability.

6. Legal issue on the chargeability of additional sales tax:
The legal issue involved in the challenge before the Tribunal was the chargeability of additional sales tax under the amended provision for the period August 1, 1996, to March 31, 1997. The court directed the appellant to seek appellate remedy to address this issue without considering the question of limitation.

7. Direction to seek appellate remedy:
The court directed the appellant to seek appellate remedy by filing an appeal within two weeks. The appellate authority was instructed to consider the merits of the appeal without any reference to the question of limitation. The order of the single judge was set aside, and the writ appeal was disposed of with this direction, without any costs awarded.