2024 (2) TMI 664 - HC - VAT and Sales Tax

Revisional jurisdiction of High Court - Clandestine Removal - cigarettes - committed error in counting the stock which resulted in noting shortage of 480 cartons - HELD THAT - It is settled principle of law that the Tribunal is the primary body responsible for fact-finding, and when this Court exercises its revisionary authority, it does not re-examine facts already adjudicated upon by the Tribunal. The revisional jurisdiction exercised by High Courts is limited, focusing primarily on jurisdictional errors, perversity and procedural irregularities. In a revision petition, the High Court should abstain from undertaking a fresh enquiry into factual matters already adjudicated by the tribunal, unless compelling reasons necessitate an intervention of such a nature by the High Court. In VINOD KUMAR TEWARI VERSUS STATE OF U.P. AND ORS. 2015 (3) TMI 1433 - ALLAHABAD HIGH COURT , this Court outlined the difference between appeal and revision and marked the boundaries within which revisional jurisdiction is to be exercised. What becomes apparent from a reading of the aforesaid judgment is that legislature s conferment of the right to appeal in one instance and the discretionary remedy of revision in another. This implies the creation of two distinction jurisdictions, differing in scope and content. While appeal typically entails a comprehensive review encompassing both law and fact initiated by an aggrieved party, revision is akin to a power of superintendence, sometimes invoked even without the party s initiative. The extent of revisional jurisdiction is circumscribed by the statue conferring such authority, generally aimed to ensuring conformity to legal principles and procedural propriety. Appeal can be seen as a judicial examination seeking the reversal of a lower authority s decision by the superior court. Meanwhile, revision empowers the superior court to scrutinize the records of an appeal to assess its legality, propriety, or regularity of procedure, and to issue orders accordingly. Revisional jurisdiction, as envisaged under the UPVAT Act, 2008, is meticulously tailored to address jurisdictional errors and excesses of law that may have permeated the adjudicative process at lower echelons of the judicial hierarchy. It is incumbent upon High Courts, when exercising revisional jurisdiction, to vigilantly scrutinize the legal landscape and ascertain whether the impugned judgment or order suffers from any infirmities of jurisdictional import or egregious deviations from the normative contours of legal propriety - Revisional jurisdiction is not conceived as a vehicle for the protracted re-examination of factual matrices, or the interminable redressal of grievances already exhaustively adjudicated upon by the lower courts or tribunals. Rather, it constitutes an instrumental mechanism for rectifying egregious legal errors or jurisdictional excesses that may have vitiated the adjudicative process, thereby ensuring the equitable and efficacious administrative of justice. The Revisionist in the instant case, has tried to invite this court to reassess the factual matrix, as adjudicated upon by the second appellate authority. Such an exercise, in absence of any perversity in the factual adjudication by the second appellate authority runs counter to the settled principles governing the exercise of revisional jurisdiction. The second appellate authority, in my opinion, has cogently addressed the nuances of this case and rendered a reasoned decision, devoid of any palpable error of infirmity - In the absence of any glaring defect or legal transgression warranting revision, it is not inclined to interfere with the impugned order dated January 25, 2023, passed by the second appellate authority. The impugned order dated January 25, 2023, does not warrant any intervention - the instant revision is dismissed.

Issues Involved:
1. Legality of the second appellate authority's decision regarding the alleged error in stock counting.
2. Justification for the rejection of the Opposite Party's account books.
3. Validity of the additional tax liability imposed by the assessing authority.
4. Scope and limits of revisional jurisdiction under the UPVAT Act, 2008.

Summary:

1. Legality of the second appellate authority's decision regarding the alleged error in stock counting:
The Revisionist contended that the second appellate authority was not legally justified in accepting the Opposite Party's contention that the surveying authority committed an error in counting the stock, resulting in a noted shortage of 480 cartons. The Revisionist argued that the counting was conducted in the presence of a responsible person from the Opposite Party, who did not object to the counting process at the time. However, the second appellate authority found that the surveying authority had committed a fault in counting the cartons and accepted the Opposite Party's explanation that the differences had been reconciled and no actual shortage was found.

2. Justification for the rejection of the Opposite Party's account books:
The assessing authority rejected the Opposite Party's account books based on the alleged shortage of 480 cartons, presumed to have been sold out of books to evade the enhanced tax rate effective from July 1, 2012. The first appellate authority upheld this rejection. However, the second appellate authority accepted the Opposite Party's contention that the stock found was in accordance with the stock ledger and that the surveying authority committed errors in counting. The second appellate authority further noted that the goods were excisable commodities, checked by the Excise Department, making evaded sales unlikely.

3. Validity of the additional tax liability imposed by the assessing authority:
The assessing authority imposed an additional tax liability based on the presumed evasion of sales and purchases. The Opposite Party contested this, providing detailed explanations and representations to the authorities, requesting re-verification of the stock, which was not conducted. The second appellate authority found the explanations satisfactory and concluded that no valid grounds existed for the additional tax liability.

4. Scope and limits of revisional jurisdiction under the UPVAT Act, 2008:
The High Court emphasized that its revisional jurisdiction is limited to addressing jurisdictional errors, perversity, and procedural irregularities, and does not involve re-examining facts already adjudicated by the Tribunal. The Court cited precedents to underline that revisional jurisdiction is not as extensive as appellate jurisdiction and should not be used to reappraise evidence or substitute the Tribunal's findings with its own. The Court found no compelling reason to interfere with the second appellate authority's factual findings and upheld the impugned order, dismissing the revision petition.

Conclusion:
The High Court dismissed the revision petition, upholding the second appellate authority's order dated January 25, 2023, and concluded that there was no overarching element of perversity or patent illegality in the impugned order that warranted the exercise of its revisional powers. The Court reiterated that revisional jurisdiction should not be used to reassess factual matrices adjudicated by lower authorities unless there are compelling reasons of jurisdictional error or legal transgression.

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