2018 (2) TMI 1224 - HC - VAT and Sales Tax

Maintainability of petition - alternative remedy - Principles of natural justice - Held that - Merely raising a hue and cry about the breach of principles of natural justice does not entitle the petitioner-assessee to invoke the extraordinary Writ jurisdiction of this Court against the orders, which are appealable before the regular Authorities of the Department created under the enactments. The power of these Appellate Authorities with two-tier appeal remedies provided under the KVAT Act, first under Section 62 of the Act before the Joint Commissioner (Appeals) and secondly, before the Karnataka Appellate Tribunal under Section 63 of the Act, which have co-extensive powers, as the Assessing Authority has under the said Act. Even assuming that the petitioner-assessee could not adduce relevant evidence before the Assessing Authority, he still has such opportunity available to him even before the Appellate Authorities. Nothing entitles the petitioner assessee to invoke the Writ jurisdiction of this Court in these circumstances - petition devoid of merits and is dismissed.

Summary

Issues:
Challenge to reassessment order under Section 39(1) of KVAT Act, 2003 for the period 2011-2012 due to alleged breach of principles of natural justice.

Analysis:
The petitioner, M/s.S.K.Sales Agencies, challenged the reassessment order passed by the Assessing Authority under Section 39(1) of the KVAT Act, 2003 for the period 2011-2012. The petitioner contended a breach of principles of natural justice, arguing that the Assessing Authority did not grant additional time despite a request made due to the absence of the company's Auditor, who was abroad. The petitioner sought one month to respond to the queries but the order was passed on 17.6.2017 without granting the requested time. The petitioner argued that this breach of natural justice rendered the reassessment order invalid.

The learned counsel for the petitioner raised concerns about the breach of natural justice, highlighting that the Assessing Authority did not grant the requested time for response, leading to a violation of principles of natural justice. However, the Additional Government Advocate representing the Commercial Taxes Department opposed the petitioner's submissions, arguing against the validity of the petitioner's claims.

The Court found that the petitioner had an alternative remedy available under Section 62 of the KVAT Act, making the present writ petitions not maintainable. The Court also observed that the petitioner's claim of breach of natural justice was not sustainable. The petitioner had requested an extended period without providing evidence that it was impossible to respond within the stipulated time. The Court noted that the petitioner could have submitted objections with relevant evidence before the order date but failed to do so. The Court emphasized that the extraordinary writ jurisdiction should not be invoked merely based on allegations of natural justice breaches.

The Court highlighted the availability of two-tier appeal remedies under the KVAT Act, allowing the petitioner to present relevant evidence before the Appellate Authorities. The Court concluded that the petitioner had no grounds to invoke the writ jurisdiction under the circumstances. Consequently, the Court dismissed the writ petitions, advising the petitioner to file an appeal within four weeks without facing objections regarding the limitation period, subject to other appeal conditions being met.

In summary, the High Court of Karnataka dismissed the writ petitions challenging the reassessment order under the KVAT Act, 2003, emphasizing the availability of alternative remedies and the importance of providing evidence to support claims of natural justice breaches.