2021 (4) TMI 175 - HC - VAT / Sales Tax

Condonation of delay in filing petition - challenge to orders of assessment passed in terms of the provisions of the Tamil Nadu Value Added Tax Act, 2006 - present Writ Petitions challenge orders of assessment, and have been filed beyond the period of 90 (60 30) days provided in terms of Section 51 of the Act from the date of receipt of the orders by the petitioners - HELD THAT - The trigger for the present discussion is the recent judgment of the Supreme Court in the case of Assistant Commissioner (Ct) LTU vs. M/s.Glaxo Smith Kline Consumer Health Care Limited 2020 (5) TMI 149 - SUPREME COURT , wherein this issue arose - Upon compliance with the terms imposed, the matter was heard and the writ petition came to be allowed quashing the order of assessment and relegating the matter to the assessing authority to be redone afresh after hearing the petitioner. It is thus that the revenue carried the matter in appeal to the Supreme Court arguing that the High Court had exceeded its jurisdiction and committed a manifest error in admitting a writ petition beyond the period of limitation set out in the concerned statute. The wide powers with which the High Court is invested must not be exercised in such a way that are inconsistent with legislative intent prescribing a rigid limitation under statute. In conclusion, the Bench reverses the decision of the High Court and allows the writ appeals saying that no case have been made out either before the High Court, and no finding has been recorded by the High Court in regard to its decision for entertaining the writ petition beyond the period of statutory limitation - Article 226 of the Constitution of India is thus, elastic enough to accommodate challenges to proceedings beyond the period provided under limitation, although such discretion has to be exercised very sparingly and the situation causing the delay examined closely and minutely. The impugned orders in W.P.Nos.14720 and 14722 of 2020 are dated 13.05.2016 and 26.05.2016 and the time for filing of appeals with delay are long gone. The Writ Petitions have, however, been filed on 08.10.2020 with a delay in excess of five years. The reasons adduced in the affidavit filed in support of the Writ Petitions is that the petitioner was unaware of the order having been passed and came to know of it only when coercive recovery proceedings were initiated for collection of the arrears. However, this is denied in the counter filed by the respondent - Service of the order upon the petitioner on 04.06.2016 is thus not in dispute - No explanation is adduced for the elapse in time between 04.06.2016 and date of filing of this writ petition which is 08.10.2020 and in the light of the materials produced by the revenue to establish service, which are also not denied by the petitioner, no justification found to entertain these writ petitions and the same are dismissed in limine. Petition dismissed.

Summary

Issues Involved:
1. Challenge to orders of assessment under the Tamil Nadu Value Added Tax Act, 2006.
2. Delay in filing statutory appeals beyond the prescribed period.
3. Justifiability of delay due to personal, human, or medical reasons.
4. Impact of COVID-19 pandemic on filing delays.
5. Jurisdiction of the High Court under Article 226 of the Constitution of India to entertain writ petitions beyond statutory limitation periods.
6. Precedents and legal principles regarding the High Court's discretion to entertain delayed writ petitions.

Detailed Analysis:

1. Challenge to Orders of Assessment:
All the writ petitions challenge orders of assessment under the Tamil Nadu Value Added Tax Act, 2006. These orders were passed beyond the statutory period for filing appeals, which is 60 days plus an additional 30 days for condonation of delay as per Section 51 of the Act.

2. Delay in Filing Statutory Appeals:
The petitions were filed beyond the 90-day period stipulated by the Act. Specific cases include:
- W.P.Nos.15679 and 15683 of 2020: Orders dated 19.03.2019 and 22.03.2019, served on 13.03.2020, with appeals due by 12.06.2020, but petitions filed on 23.10.2020.
- W.P.No.17525 of 2020: Order dated 18.12.2012 with a delay of over seven years, citing the benefit of input tax credit under Section 19(11) and subsequent rejection under Section 22(6)(a).

3. Justifiability of Delay:
The court examined the reasons for delays, including:
- Illness of consultants and practitioners.
- The impact of the COVID-19 pandemic.
- Miscommunication and procedural delays within the petitioners' organizations.

For instance:
- W.P.Nos.17926 and 17927 of 2020: Delay due to the death of a Sales Tax Practitioner and subsequent delays caused by the pandemic.
- W.P.No.120 of 2021: Delay of 1282 days blamed on a tax consultant, but no evidence was provided, leading to dismissal.

4. Impact of COVID-19 Pandemic:
The Supreme Court extended the time for filing appeals due to the pandemic, which was considered in the judgment. Appeals were allowed to be filed until 31.01.2021, accounting for pandemic-related delays.

5. Jurisdiction under Article 226:
The judgment discussed the High Court's discretion under Article 226 to entertain writ petitions beyond statutory limitations. The court referred to the Supreme Court's judgment in Assistant Commissioner (Ct) LTU vs. M/s.Glaxo Smith Kline Consumer Health Care Limited, emphasizing that High Courts must exercise this power sparingly and only under exceptional circumstances.

6. Precedents and Legal Principles:
The court reviewed several precedents, including:
- Mafatlal Industries Ltd. v. Union of India.
- K.S. Rashid & Son v. Income Tax Investigation Commission.
- Baburam Prakash Chandra Maheshwari v. Antarim Zila Parishad.
- Oil and Natural Gas Corporation Limited v. Gujarat Energy Transmission Corporation Limited.

The court concluded that while the High Court has wide powers under Article 226, these must align with legislative intent and not render statutory provisions otiose.

Conclusion:
The writ petitions were allowed, permitting the petitioners to file statutory appeals within four weeks, to be entertained without reference to limitation but subject to other compliances. However, some petitions were dismissed in limine due to inadequate justification for delays, such as:
- W.P.Nos.17709, 17710, 17712, 17714, 17717, 17720 of 2020: Delay not justified between 18.09.2019 and March 2020.
- W.P.No.120 of 2021: Delay of 1282 days without sufficient evidence.
- W.P.Nos.14720 and 14722 of 2020: Delay in excess of five years without valid explanation.

The court emphasized that discretion under Article 226 should be exercised sparingly and with careful consideration of the circumstances causing the delay.