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2013 (10) TMI 346 - HC - VAT and Sales TaxValidity of writ petition - alternative remedy - Validity of assessment order - Jurisdiction of assessing officer - Violation of principle of natural justice - Held that - Tribunals are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for the High Courts and the Supreme Court which have, under our constitutional set up, been specifically entrusted with such an obligation. Their function in this respect is only supplementary and all such decisions of the Tribunals will be subject to scrutiny before a Division Bench of the respective High Courts. The Tribunals will consequently also have the power to test the vires of subordinate legislations and rules. However, this power of the Tribunals will be subject to one important exception. The Tribunals shall not entertain any question regarding the vires of their parent statutes following the settled principle that a Tribunal which is a creature of an Act cannot declare that very Act to be unconstitutional. In such cases alone, the High Court concerned may be approached directly. All other decisions of these Tribunals, rendered in cases that they are specifically empowered to scrutiny before a Division Bench of their respective High Courts. We may add that the Tribunals will, however, continue to act as the only Courts of first instance in respect of the areas of law for which they have been constituted. By this, we mean that it will not be open for litigants to directly approach the High Courts even in cases where they question the vires of statutory legislations (except, as mentioned, where the legislation which creates the particular Tribunal is challenged) by overlooking the jurisdiction of the Tribunal concerned. - Following decision of L. Chandra Kumar vs- Union of India & ors. 1997 (3) TMI 90 - SUPREME Court - Decided against assessee.
Issues Involved:
1. Violation of principles of natural justice. 2. Non-supply of the Bureau of Investigation (BOI) report. 3. Maintainability of the writ petition in light of alternative remedies. Detailed Analysis: Violation of Principles of Natural Justice The petitioner challenged the assessment order on the grounds of gross violation of principles of natural justice. The primary contention was that the Deputy Commissioner, Sales Tax, did not provide a pre-assessment show cause notice, thereby denying the petitioner an opportunity to defend against the presumptions raised by the respondent. The petitioner argued that this failure to follow due process resulted in an illegal tax demand without a fair hearing. Non-Supply of the BOI Report The petitioner emphasized that the assessment order was based on a report prepared by the Bureau of Investigation (BOI), which was not supplied to them. This non-supply of the BOI report was asserted to be a significant violation of natural justice, as it prevented the petitioner from effectively challenging the findings and defending their case. The respondents admitted in their affidavit that the BOI report was considered in the assessment but was not provided to the petitioner. Maintainability of the Writ Petition The central issue was whether the writ petition could be maintained despite the existence of an alternative remedy. The petitioner argued that the High Court could exercise its jurisdiction under Article 226 of the Constitution of India in cases of violation of fundamental rights, principles of natural justice, or where the order is wholly without jurisdiction. The petitioner relied on several Supreme Court judgments, including *Whirlpool Corporation v. Registrar of Trade Marks, Mumbai* and *L. Chandra Kumar v. Union of India*, to support this contention. The respondents, however, contended that the petitioner should have approached the Tribunal constituted under Article 323B of the Constitution of India. They maintained that the BOI report's non-supply did not constitute a gross violation of natural justice and that the petitioner had other remedies available. Judgment Summary The court examined whether the writ petition was maintainable in light of the principles laid down in *L. Chandra Kumar v. Union of India*. The court noted that while the High Court has the power of judicial review, this power is to be exercised by a Division Bench of the High Court after the petitioner has exhausted the available remedies before the Tribunal. The West Bengal Taxation Tribunal, constituted under the West Bengal Taxation Tribunal Act, 1987, has the jurisdiction to adjudicate disputes related to the West Bengal Value Added Tax Act, 2003. The court concluded that the single bench of the High Court does not retain jurisdiction to entertain the writ petition, which falls within the exclusive domain of the Taxation Tribunal. The petitioner must first approach the Tribunal, and only after exhausting this remedy can the matter be brought before the Division Bench of the High Court. Conclusion The writ petition was dismissed on the grounds of maintainability, with the court clarifying that it had not delved into the merits of the assessment order or the alleged violation of principles of natural justice. The petitioner was directed to seek remedy before the West Bengal Taxation Tribunal. No order as to costs was made, and urgent certified copies of the judgment were to be provided to the parties if applied for.
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