2025 (1) TMI 473 - HC - VAT / Sales Tax

Maintainability of petition - availability of alternative statutory appellate remedy - invocation of writ jurisdiction of the High Court - HELD THAT - It is inclined to grant a limited indulgence in the matter to the effect that appellant can prefer a statutory appeal against the orders that were impugned in the writ petitions subject to he making pre-deposit of 30% of disputed tax along with interest accruing due thereon till the filing of writ petitions i.e., 30.08.2019, within four weeks. This appeal is disposed off permitting the appellant to avail the remedy of statutory appeal under section 62 of the 2003 Act subject to depositing 30% of the amount due in terms of the impugned Assessment Orders; the interest accruing due on such amount only till 30.08.2019 shall also be reckoned while computing this.

Summary

1. ISSUES PRESENTED and CONSIDERED

The judgment primarily revolves around the following core legal questions:

• Whether the appellant can bypass the statutory appellate remedy and invoke the writ jurisdiction of the High Court due to the perceived inefficacy of the statutory remedy, particularly concerning the pre-deposit requirement.
• Whether the treatment of transactions as 'composite transactions' in certain assessment orders, but not in the impugned orders, justifies the invocation of writ jurisdiction.
• Whether the principle of treating like cases alike applies, warranting similar relief for similarly circumstanced litigants.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Invocation of Writ Jurisdiction Over Statutory Remedy

• Relevant Legal Framework and Precedents: The Karnataka Value Added Tax Act, 2003, particularly Section 62, provides for a statutory appellate remedy, which includes a pre-deposit requirement as a condition for appeal. The rule of alternate remedy in writ jurisdiction is a judicial principle that discourages the bypassing of statutory remedies.
• Court's Interpretation and Reasoning: The court acknowledged that while the statutory remedy is a creature of law and can be conditioned by the legislature, exceptions to the rule of alternate remedy exist. The court found that the appellant's situation might fit into such an exception.
• Key Evidence and Findings: The appellant argued that the statutory appeal was not efficacious due to the pre-deposit requirement. The court considered this argument but emphasized the statutory policy behind the pre-deposit requirement.
• Application of Law to Facts: The court allowed the appellant to pursue the statutory appeal, conditional upon making a pre-deposit of 30% of the disputed tax, acknowledging the statutory framework while accommodating the appellant's concerns.
• Treatment of Competing Arguments: The court balanced the appellant's argument about the inefficacy of the statutory remedy with the respondent's argument emphasizing the statutory framework and the principle of alternate remedy.
• Conclusions: The court permitted the appellant to file a statutory appeal, subject to the pre-deposit condition, thus maintaining the statutory framework while offering limited relief.

Issue 2: Treatment of Transactions as 'Composite Transactions'

• Relevant Legal Framework and Precedents: The legal framework involves the interpretation of transactions under the Karnataka Value Added Tax Act, 2003, and whether they qualify as 'composite transactions'.
• Court's Interpretation and Reasoning: The court did not delve deeply into the merits of whether the transactions were correctly classified, as it focused on procedural aspects and the availability of statutory remedies.
• Key Evidence and Findings: The appellant contended that similar transactions had been treated differently in other assessment orders, which was not sufficiently addressed by the Single Judge.
• Application of Law to Facts: The court did not make a determination on the substantive classification of transactions but allowed the appellant to pursue this argument in the statutory appeal.
• Treatment of Competing Arguments: The court did not engage in substantive analysis of the transaction classification, focusing instead on procedural remedies.
• Conclusions: The court left the substantive issue open for determination in the statutory appeal process.

Issue 3: Principle of Treating Like Cases Alike

• Relevant Legal Framework and Precedents: The principle of treating like cases alike is a fundamental legal principle, ensuring consistency and fairness in judicial decisions.
• Court's Interpretation and Reasoning: The court referenced a previous decision, emphasizing that similar relief should be granted to similarly circumstanced litigants unless derogatory circumstances exist.
• Key Evidence and Findings: The court noted the similarity between the current case and a prior decision, applying the principle of consistency.
• Application of Law to Facts: The court applied this principle to grant the same relief in the companion case, ensuring consistency in judicial outcomes.
• Treatment of Competing Arguments: The court did not identify any derogatory circumstances that would justify different treatment in the companion case.
• Conclusions: The court granted similar relief in the companion case, adhering to the principle of treating like cases alike.

3. SIGNIFICANT HOLDINGS

• Verbatim Quotes of Crucial Legal Reasoning: "The legal requirement of making pre-deposit of certain monies as a sine qua non is a matter of statutory policy under which right of appeal is created... However, several exceptions to this broad proposition galore, cannot be much disputed."
• Core Principles Established: The judgment reinforces the principle that statutory remedies should generally be pursued unless exceptional circumstances justify the invocation of writ jurisdiction. It also underscores the importance of consistency in judicial decisions through the principle of treating like cases alike.
• Final Determinations on Each Issue: The court allowed the appellant to pursue the statutory appeal subject to a pre-deposit condition, left the substantive issue of transaction classification open for appeal, and granted similar relief in the companion case based on the principle of consistency.