2010 (7) TMI 939 - HC - VAT and Sales Tax

Whether the goods have not been sent to the own depot by way of stock transfer and, in respect of the export, the required certificates have not been furnished? Held that - There was substantial compliance of rule 77(1)(a) and rule 77(3) of the Rules and, therefore, there was proper service of the notices under section 21(1) on the petitioner in accordance with rule 77. From the perusal of the record it appears that the proceedings under section 21 have been initiated on the basis of information received from STO (SIB), Muzaffarnagar, based on the survey made at the premises of Tomar Transport Co., Shamli Road, Muzaffarnagar, wherein incriminatory materials were found, which have been referred in the order. Therefore, it cannot be said that there was no material to initiate the proceedings. It is the settled principle of law that in the writ jurisdiction under article 226 of the Constitution, this court cannot examine the sufficiency of the material. Appeal dismissed.

Summary

Issues:
Challenge to the notice dated March 26, 2002 and order dated Central Act based on service of notices under section 21 and assessment orders legality.

Analysis:
The petitioner challenged the notice and orders claiming improper service of notices under section 21. The counsel argued that non-service of notices as per Rule 77 of the U.P. Trade Tax Rules renders the proceedings illegal, citing a Full Bench decision. The process server's report indicated refusal by the authorized representative to accept the notices due to illness, a claim disputed by the state. The state contended that refusal constitutes valid service under Rule 77(1)(a) and Rule 77(3), supported by case precedents. The initiation of proceedings was based on information from a survey at a specific location, providing a legal basis for action.

The court examined the petitioner's argument regarding improper service of notices. It noted the absence of specific denial of the authorized representative's meeting with the process server, undermining the petitioner's claim of non-service. The court found substantial compliance with Rule 77(1)(a) and Rule 77(3), validating the service of notices. The court emphasized that sufficiency of material for initiating proceedings cannot be questioned in a writ jurisdiction under Article 226. Disputed facts, including ex parte orders, are more suited for appellate review, and the petitioner has recourse to statutory remedies like an application under section 30 or an appeal under section 9 of the State Act. Consequently, the court declined to interfere with the assessment order.

In conclusion, the court dismissed the writ petition, finding no merit in the challenge to the notice and orders based on service of notices under section 21. The judgment underscores the importance of procedural compliance and the limited scope of writ jurisdiction in assessing factual disputes in tax matters, directing parties to appropriate statutory remedies for redressal.