2018 (7) TMI 1267 - HC - VAT and Sales Tax

Validity of Revision proceedings - Section 27 of the Tamil Nadu Value Added Tax Act 2006 - case of petitioner is that the revision is uncalled for and the assessment was already accepted and all further proceedings were dropped - effective alternative remedy of appeal. Held that - Section 51 of the TNVAT Act provides an Appeal to the Appellate Deputy Commissioner and Section 52 of the TNVAT Act provides an Appeal to the Appellate Joint Commissioner. Further Section 84 of the TNVAT Act provides Power to rectify any error apparent on the face of the record. Section 84(4) of the TNVAT Act states that the powers under sub-section (1) may be exercised by the assessing authorities even though the original order of assessment if any passed in the matter has been the subject-matter of an appeal or revision. Section 84(5) of the TNVAT Act enumerates that the provisions of this Act relating to appeal and revision shall apply to an order of rectification made under this section as they apply to the order in respect of which such order of rectification has been made. The functions of the Appellate Authority under the TNVAT Act is quasi judicial in nature. They are empowered to conduct the proceedings by summoning the persons or calling for the documents or otherwise. Thus the writ petitioner has to prefer an appeal against the order of revision which is impugned in these present writ petitions. The very purpose of the appeal provision is to ensure that the orders passed by the original authorities are checked and the aggrieved person must get a remedy even before the Appellate forum. In all circumstances if such appeal provision is dispensed with then it will amount to circumventing the provisions of the TNVAT Act and further this Court is of an opinion that the appeals provided under such statute are to be trusted even by the aggrieved persons. Thus the writ petition is not only belated since filed after a lapse of two years from the date of passing of the impugned order but the appeal provision provided under the statute has not been exhausted by the writ petitioner. Under these circumstances the present writ petitions cannot be entertained in view of the fact that the petitioner has to exhaust the appeal remedy contemplated under the provisions of the TNVAT Act. Petition dismissed - decided against petitioner.

Summary

Issues Involved:
1. Validity of the revised orders under Section 27 of the Tamil Nadu Value Added Tax Act, 2006.
2. Availability and necessity of exhausting alternative remedies under the TNVAT Act before filing a writ petition.
3. Timeliness of filing the writ petitions.

Detailed Analysis:

1. Validity of the Revised Orders under Section 27 of the TNVAT Act:
The petitioner contended that the revised orders issued by the Commercial Tax Officer were untenable as the initial assessment had been accepted and further proceedings dropped. The petitioner claimed that all necessary objections and documents had been submitted, and input tax had been reversed, rendering the revised orders unsustainable. Conversely, the respondent argued that the competent authority was empowered to revise orders upon finding discrepancies in the assessment, and the revised orders were issued after providing the petitioner an opportunity to submit explanations and objections.

2. Availability and Necessity of Exhausting Alternative Remedies:
The petitioner argued that filing an appeal would necessitate depositing 25% of the demanded amount, which they sought to avoid by filing a writ petition under Article 226 of the Constitution of India. The court emphasized that Section 51 and Section 52 of the TNVAT Act provide for appeals to the Appellate Deputy Commissioner and the Appellate Joint Commissioner, respectively. Additionally, Section 84 provides the power to rectify any error apparent on the face of the record. The court noted that the petitioner had already filed an application under Section 84, which was rejected by a non-speaking order, and thus, the petitioner should have preferred an appeal against this rejection.

The court reiterated that the functions of the Appellate Authority under the TNVAT Act are quasi-judicial, and the petitioner should have approached the Appellate Authority rather than filing a writ petition. The court cited several precedents emphasizing that a writ petition should not be entertained if an effective alternative remedy is available, except in exceptional circumstances where there is gross injustice or violation of fundamental rights.

3. Timeliness of Filing the Writ Petitions:
The court noted that the writ petitions were filed after a significant delay of about two years from the dates of the impugned orders (19.09.2016 and 21.10.2016), making them liable to be rejected on grounds of laches. The court stressed the importance of maintaining institutional respect and exhausting statutory remedies before approaching the constitutional courts.

Conclusion:
The court dismissed the writ petitions, emphasizing that the petitioner should have exhausted the available appeal remedies under the TNVAT Act. The court highlighted that the appeal provisions are designed to ensure that orders by original authorities are checked, and aggrieved persons receive remedies at the appellate level. The writ petitions were not only belated but also filed to circumvent the statutory requirement of depositing 25% of the demanded amount for an appeal. Consequently, the court ruled that the writ petitions could not be entertained, and there would be no order as to costs. The court directed the registry to return the original impugned orders to the petitioner’s counsel.