2008 (7) TMI 924 - HC - VAT and Sales Tax

Violation of natural justice - ground of alternative remedy - Held that - In view of the settled legal position, i.e., disputed facts cannot be gone into in a writ petition and in tax matters wherever alternate remedy is provided, writ petition shall not be entertained, thus these writ petitions challenging the orders of assessment made by the respondent, (1)Reported as chophard Builders (P) Ltd. v. Deputy Commercial Tax Officer 2007 (9) TMI 589 - MADRAS HIGH COURT are not maintainable and the petitioner is bound to file appeals against the said orders of assessment as per section 31 of the Act. The petitioner is given two weeks time to file appeals against the orders of the assessment and if such appeals are filed within two weeks, the appellate authority is directed to consider the same on merits and in accordance with law, without referring to the period of limitation. Since I am dismissing the writ petitions solely on the ground of availability of alternate remedy, merits of the cases canvassed by the learned counsel for the petitioner-company and by the learned Additional Government Pleader are not considered and decided in this order, in any manner.

Issues Involved:
1. Violation of Principles of Natural Justice
2. Availability of Alternative Remedy
3. Maintainability of Writ Petition in Tax Matters
4. Disputed Facts in Writ Jurisdiction

Detailed Analysis:

1. Violation of Principles of Natural Justice:
The petitioner, a private limited company engaged in heavy civil contract works and registered under the Tamil Nadu General Sales Tax Act, 1959, challenged the final assessment orders on the ground of violation of natural justice. The petitioner argued that the orders were passed without adequate opportunity for personal hearing. The second respondent issued several notices and passed final orders without considering the objections and requests for personal hearings from the petitioner. The petitioner contended that this amounted to a violation of the principles of natural justice.

2. Availability of Alternative Remedy:
The court noted that the petitioner had an alternative remedy available under Section 31 of the TNGST Act, 1959, which allows for an appeal to the Appellate Assistant Commissioner. The learned Additional Government Pleader argued that the petitioner should have availed of this remedy, as the appellate authority is empowered to confirm, reduce, enhance, or annul the assessment or penalty, or direct a fresh assessment after further inquiry. The court emphasized that the availability of an alternative remedy is a rule of discretion and convenience, particularly in tax matters.

3. Maintainability of Writ Petition in Tax Matters:
The court cited several precedents, including decisions of the Supreme Court and Division Benches of the High Court, which consistently held that writ petitions should not be entertained in tax matters when an alternative remedy is available. The court referred to the principle that statutory remedies should be exhausted before invoking writ jurisdiction under Article 226 of the Constitution of India. The court highlighted the Supreme Court's view in cases like Titaghur Paper Mills Co. Ltd. v. State of Orissa and Assistant Collector of Central Excise, Chandan Nagar v. Dunlop India Limited, which underscored the necessity of exhausting statutory remedies in tax matters.

4. Disputed Facts in Writ Jurisdiction:
The court observed that disputed facts cannot be decided in a writ petition, as held in the Supreme Court decisions in Himmat Singh v. State of Haryana and Food Corporation of India v. Harmesh Chand. The court reiterated that when facts are in dispute, the appropriate course is to approach the appellate authority or a civil court of competent jurisdiction. The court emphasized that the writ jurisdiction should not be exercised when there are disputed facts that require consideration of evidence.

Conclusion:
The court dismissed the writ petitions on the ground that the petitioner should have availed the alternative remedy of filing an appeal under Section 31 of the TNGST Act, 1959. The court provided the petitioner with two weeks to file appeals against the orders of assessment, directing the appellate authority to consider the appeals on merits without referring to the period of limitation. The court did not consider or decide the merits of the case, focusing solely on the procedural aspect of exhausting alternative remedies. Both writ petitions and connected miscellaneous petitions were dismissed without costs.

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