2021 (10) TMI 1163 - HC - GST

Maintainability of petition - availability of alternate remedy by way of appeal - Violation of principles of natural justice - objections of the writ petitioner has not been considered - beneficiary of Input Tax Credit - HELD THAT - If the articulation in the impugned orders is insufficient or in other words, if it is not ample or adequate, it becomes a question of whether it is terse and epigrammatic or laconic. Even a terse order can be eloquent. An order can be terse but epigrammatic. It can be tersely eloquent. An order can appear to give out reason, but it can be laconic. In this case on hand ITC being allegedly adjusted towards outward tax liability turns heavily on facts/figures and it would be appropriate for an Appellate Authority which can go into facts and have the benefit of records to go into this. Therefore, it cannot be gainsaid that this is a case where objections of writ petitioner not being considered point is compelling enough to warrant interference in writ jurisdiction on the teeth of alternate remedy. Very recently i.e., on 03.09.2021 Hon'ble Supreme Court i.e., a three member Bench of Hon'ble Supreme Court speaking through Hon'ble Justice Dr.Dhananjaya Y Chandrachud in THE ASSISTANT COMMISSIONER OF STATE TAX AND OTHERS VERSUS M/S COMMERCIAL STEEL LIMITED 2021 (9) TMI 480 - SUPREME COURT , while reiterating the aforementioned Rule of alternate remedy rule qua fiscal Statute has culled out the exceptions to alternate remedy rule and held that interference in writ jurisdiction shall be only under exceptional circumstances and there is also an adumbration of exceptional circumstances. In the case on hand, the lone point that is urged before this Court turns on NJP violation. This Court has come to the conclusion (as would be evident from the discussion and dispositive reasoning articulated supra) that alleged NJP facet violation in this case is not compelling enough. Absent compelling NJP violation, as there is no other exception (exceptions to alternate remedy rule) that arises in the case on hand, it is clear that this is a fit case to relegate the writ petitioner to alternate remedy by way of statutory appeal under Section 107 of TNGST Act and C-GST Act. As this Court is relegating writ petitioner-dealer to alternate remedy of statutory appeal, it is made clear that this Court has not expressed any view or opinion on the merits of the matter. If the writ petitioner chooses to take alternate remedy route or statutory appeal under Section 107 of TN-GST Act and C-GST Act, the same will be dealt with and decided on its own merits, in accordance with law by Appellate Authority uninfluenced by any observation that is made in this order which is for the limited purpose of disposal of captioned writ petitions - Petition dismissed.

Summary

Issues Involved:
- Alleged violation of Natural Justice Principle in adjusting Input Tax Credit towards outward tax liability without considering objections.
- Applicability of alternate remedy rule under Section 107 of TN-GST Act and C-GST Act.

Detailed Analysis:

Violation of Natural Justice Principle:
The writ petitioner contended that the respondent did not consider their objections before adjusting Input Tax Credit (ITC) towards outward tax liability, alleging a violation of the Natural Justice Principle (NJP). The respondent, through the learned Revenue counsel, argued that the objections were indeed considered, and the adjustment was based on the petitioner being a beneficiary of ITC. The court emphasized that even if the reasoning provided was deemed insufficient, it would be a matter for appeal rather than interference in writ jurisdiction based on NJP violation. The court highlighted that the matter heavily relied on factual aspects, making it suitable for review by an Appellate Authority with access to records. Therefore, the alleged NJP violation was not deemed sufficient to warrant interference in writ jurisdiction.

Applicability of Alternate Remedy Rule:
The court acknowledged the availability of an alternate remedy through an appeal under Section 107 of the TN-GST Act and C-GST Act for the writ petitioner. It delved into the principle of the alternate remedy rule, emphasizing that it is a discretionary self-imposed restraint on writ jurisdiction. Citing precedents, including Dunlop India case, Satyawati Tandon case, and K.C. Mathew case, the court highlighted that the alternate remedy rule is to be strictly applied, especially in fiscal statutes. The court referenced exceptions to the rule outlined in the Commercial Steel Limited case, emphasizing that interference in writ jurisdiction should occur only under exceptional circumstances, such as fundamental rights breach, natural justice violation, excess of jurisdiction, or statutory challenge. As the present case did not fall under any exception and lacked compelling NJP violation, the court concluded that the writ petitioner should pursue the statutory appeal route under Section 107, refraining from expressing any opinion on the case's merits.

In the final judgment, the court dismissed the captioned Writ Petitions while preserving the writ petitioner's rights to pursue the statutory appeal under Section 107 of the TN-GST Act and C-GST Act. The court clarified that any appeal would be decided on its merits by the Appellate Authority, independent of the observations made in the order. The writ petitioner was also granted the opportunity to request exclusion of time spent in the court for limitation computation purposes before the Appellate Authority. The judgment concluded without imposing any costs on the parties involved.