1999 (1) TMI 526 - HC - VAT and Sales Tax

Summary

Issues:
Violation of principles of natural justice in the imposition of penalty under Sec.45A of the KGST Act, 1963.

Analysis:
The appellant challenged the Ext. P4 order levying a penalty for incomplete returns, arguing a violation of natural justice principles. The Single Judge dismissed the petition, citing an alternate remedy of revision. However, the High Court found fault with the first respondent for not providing a reasonable opportunity for the appellant to respond. The Court noted that the first respondent issued the penalty without a fair hearing, contrary to established legal principles. The appellant's engagement in liquor sales to the State Beverages Corporation was also highlighted, emphasizing the correct application of turnover tax laws. The High Court referenced a Supreme Court ruling emphasizing that an alternate remedy does not bar a writ petition when fundamental rights enforcement or natural justice violation is at issue.

The High Court concluded that the Single Judge erred in dismissing the petition based on the availability of a revision remedy. The Court held that the appellant's fundamental rights were at stake, and natural justice principles were breached. As a result, the first respondent's order was deemed without jurisdiction. The Court invoked its jurisdiction under Art.226 of the Constitution to set aside the Single Judge's order and quash Ext. P4. Additionally, the Court extended the time for the appellant to file objections and directed the first respondent to provide a fair hearing and decide the matter in accordance with the law within a specified timeframe. The judgment underscores the importance of upholding natural justice and fundamental rights in administrative proceedings, ensuring a fair and lawful process for all parties involved.