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2019 (9) TMI 12 - HC - VAT and Sales TaxValidity of revised assessment order - Section 27(1)(a) of TNVAT Act - imposition of penalty u/s 27(3)(c) of TNVAT Act - principles of natural justice - HELD THAT - There is nothing that was canvassed by learned counsel for writ petitioner to show that alternate remedy is ineffectual or not efficacious. It is not the writ petitioner's case that the order has been passed by the respondent without jurisdiction. From the narrative thus far, it is clear that there is no violation of 'principles of natural justice' as an opportunity to show cause has been given vide revisional notice and the writ petitioner has also availed the same by filing objections on 05.12.2017. Therefore, this Court is convinced that respondent has complied with the mandate under proviso to Section 27(1)(a) of TNVAT Act i.e., the mandate of giving reasonable opportunity to show cause before making the impugned order. Alternate remedy - HELD THAT - Though alternate remedy rule is a rule of discretion and not a rule of compulsion, Hon'ble supreme Court in a long line of authorities has repeatedly held that when it comes to matters pertaining to Taxes, CESS, Revenue etc., the rule of alternate remedy should be applied with utmost rigour. In UNITED BANK OF INDIA VERSUS SATYAWATI TONDON AND OTHERS 2010 (7) TMI 829 - SUPREME COURT , it was held that the principle that rule of alternate remedy though a rule of discretion should be applied with utmost rigour when it comes to fiscal statutes - Satyawati Tandon principle was subsequently reiterated by Hon'ble Supreme Court in AUTHORIZED OFFICER, STATE BANK OF TRAVANCORE AND ANOTHER VERSUS MATHEW K.C. 2018 (2) TMI 25 - SUPREME COURT . It is open to the writ petitioner to pursue the alternate remedy subject to conditions adumbrated in Section 51 of TNVAT Act. Petition dismissed.
Issues:
1. Interpretation of provisions under Tamil Nadu Value Added Tax Act, 2006 regarding revised assessment and penalty. 2. Availability and effectiveness of alternate remedy under Section 51 of TNVAT Act. 3. Application of the rule of alternate remedy in matters related to taxes and revenue. 4. Judicial precedents emphasizing the strict application of alternate remedy rule in fiscal statutes. Analysis: Issue 1: The judgment dealt with the interpretation of provisions under the Tamil Nadu Value Added Tax Act, 2006 regarding revised assessment and penalty. The court noted that the impugned order was made under Section 27(1)(a) of the TNVAT Act for revised assessment, with penalty under Section 27(3)(c). Despite the absence of specific mention in the order, it was clarified during the hearing that the provisions of Section 27(1)(a) were invoked for the revision. The court found no violation of principles of natural justice as the petitioner was given an opportunity to show cause before the impugned order was passed. Issue 2: The court considered the availability and effectiveness of the alternate remedy under Section 51 of the TNVAT Act. The petitioner had the option to appeal to the jurisdictional Appellate Deputy Commissioner. The court emphasized that there was no indication that the alternate remedy was ineffectual or jurisdictional issues were present. The respondent was found to have complied with the requirement of providing a reasonable opportunity to the petitioner before passing the impugned order. Issue 3: The judgment discussed the rule of alternate remedy, noting that it is a self-imposed restraint on courts exercising writ jurisdiction. The court highlighted that while the rule is discretionary, in matters related to taxes, revenue, and fiscal statutes, it should be applied rigorously. Citing judicial precedents, the court reiterated that statutory remedies should be exhausted before seeking relief under Article 226 of the Constitution. Issue 4: The judgment referred to significant judicial precedents, including the Dunlop India case and subsequent cases like Satyawati Tandon and K.C. Mathew. These cases emphasized the strict application of the rule of alternate remedy in fiscal statutes. The court underscored the importance of exhausting statutory remedies before resorting to writ jurisdiction, particularly in matters involving recovery of public dues and financial institutions. In conclusion, the court dismissed the writ petition, emphasizing the importance of adhering to the rule of alternate remedy in fiscal matters. The petitioner was granted the option to pursue the alternate remedy under Section 51 of the TNVAT Act, with a reminder that questions on merits remain open if the alternate remedy is pursued.
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