2024 (12) TMI 433 - HC - GST

Maintainability of petition - availability of alternative remedy - Challenge to assessment order based on limitation period and mode of service of show-cause notices - violation of principles of natural justice - HELD THAT - Whether or not the petitioner has suppressed the fact, and whether extended period of limitation can be applied or not, is a mixed question of fact and law. The Appellate Authority is the best suited to examine this aspect, as well as the aspect of procedural impropriety, violation of principles of natural justice, un-reasoned order and other aspects raised by the learned counsel for the petitioner. In U.P. STATE SPINNING CO. LTD. VERSUS R.S. PANDEY AND ANR. 2005 (9) TMI 634 - SUPREME COURT it was held that unless serious jurisdictional error is pointed out and it is established that if the petitioner is relegated to avail the alternative remedy, it will cause palpable injustice to him, no interference can be made. We are constrained to observe that we have repeatedly asked the learned counsel for the petitioner as to why we should not relegate him to avail alternative remedy, no answer was forthcoming - the Apex Court has considered the entire legal journey on the aspect of entertaining a Writ Petition despite availability of alternative remedy. In no uncertain terms, it was made clear that rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion. In the instant case, no jurisdictional error is pointed out during the course of hearing by the learned counsel for the petitioner. The alleged breach of principles of natural justice and flaw in decision making process can be examined by the appellate authority. There are no reason to bypass the alternative remedy and deem it proper to relegate the petitioner to avail the said remedy - petition disposed off.

Summary

Issues:
Challenge to assessment order based on limitation period and mode of service of show-cause notices, contention of unreasoned order, reliance on judgments, petitioner's registration status, violation of natural justice, and departmental notifications.

Analysis:
The petitioner challenged an assessment order in a Writ Petition under Article 226, citing issues with the order's foundation on show-cause notices issued beyond the statutory limitation period of thirty months under Section 73(1) of the Finance Act. The petitioner argued that the notices served via E-mail were not prescribed by the Act, and the order lacked reasoning, failing to consider contentions supported by legal precedents. The petitioner, not being a registered body as per the order, alleged serious violations of natural justice and departmental regulations, seeking intervention due to incomplete assessment within the stipulated time.

During the hearing, the Respondent opposed, stating no procedural flaws existed, and the petitioner had the statutory right to appeal for further review. The court deliberated on whether the petitioner suppressed facts and if the extended limitation period could be applied, deeming it a mixed question of fact and law best suited for the Appellate Authority's examination. The court referred to the case law of Whirlpool Corporation v. Registrar of Trade Marks, emphasizing that a Writ Petition can be entertained in specific situations like violations of natural justice, fundamental rights, or questioning the provision's validity.

In the judgment, the court highlighted that the existence of such aspects provides discretion to the court rather than compulsion, citing U.P. State Spinning Co. Ltd. v. R.S. Pandey, which emphasized that unless a serious jurisdictional error causing palpable injustice is demonstrated, the court should not interfere. The court also referenced a recent Supreme Court decision disapproving the High Court's entertainment of a Writ Petition despite alternative remedies being available, emphasizing the rule of exhaustion of alternative remedy as a discretion rather than compulsion.

Ultimately, the court found no jurisdictional error pointed out by the petitioner during the hearing, concluding that the alleged breaches of natural justice and decision-making flaws could be addressed by the Appellate Authority. Thus, the court decided to relegate the petitioner to avail the statutory remedy, disposing of the Writ Petition while reserving liberty for the petitioner to pursue the alternative remedy without counting the time spent before the court for limitation purposes.