2007 (6) TMI 500 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to assessment order for 2005-2006 based on the application of section 3G of the Tamil Nadu General Sales Tax Act, 1959 for compounded rate of tax at three percent.

Detailed Analysis:

The petitioner challenged the assessment order for the year 2005-2006, where they reported a total turnover taxable at three percent. The firm, engaged in printing, exercised their option under section 3G of the TNGST Act for a compounded tax rate of three percent. They submitted monthly returns with payment at the compounded rate, but the respondent issued a pre-assessment notice proposing a higher tax rate of ten percent on the turnover of printed materials. The petitioner claimed exemption for the sale of reading materials. The respondent rejected the petitioner's contentions, levied a higher tax, and imposed a penalty. The petitioner contended that the assessment order was contrary to the provisions of section 3G and failed to consider their printing business.

The respondent argued that the assessing officer correctly interpreted section 3G and found the petitioner ineligible for the compounded tax rate. The court examined section 3G, which allows dealers engaged in printing to pay tax at three percent on total turnover. The assessing officer determined that the petitioner was not engaged in printing but only selling printed materials. The court noted the distinction between printing and selling printed materials and emphasized that statutory remedies should be pursued for factual disputes. It stated that writ jurisdiction should not be used to bypass statutory remedies unless the order is without jurisdiction or patently illegal. As the assessing officer's order was based on materials and not without jurisdiction, the court found no strong case for the writ petition under Article 226 of the Constitution of India.

In conclusion, the court dismissed the writ petition, emphasizing the availability of statutory remedies for challenging the assessment order.