9911796707
TMI Blog2020 (5) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... itation? 3. The respondent is a registered dealer on the rolls of Assistant Commissioner of Commercial Taxes, Large Tax Payer Unit at Kakinada Division- For short, "the Assistant Commissioner" under the provisions of Andhra Pradesh Value Added Tax Act, 2005- For short, "the 2005 Act" and the Central Sales Tax Act, 1956- For short, "the 1956 Act" and is engaged in the business of manufacturing and sale of Horlicks, Boost, Biscuits, Ghee, Ayurvedic Medicines etc. The Assistant Commissioner had called upon the respondent to produce books of accounts for the assessment year 201314 for finalisation of assessment under the 1956 Act. The authorised representative of the respondent produced declaration in Form "F" in support of its claim that certain transactions are inter State transfers. The information and declaration furnished by the respondent was duly verified and after giving personal hearing to the respondent, final assessment order came to be passed by the Assistant Commissioner on 21.6.2017, raising demand of Rs. 76,73,197/ (Rupees seventy six lakhs seventy three thousand one hundred ninety seven only) against turnover of Rs. 3,44,15,240/ (Rupees three crores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the respondent against the assessment order dated 21.6.2017, for reasons best known to the respondent. The Division Bench of the High Court, on 8.11.2018, noted that the respondent had already paid 12.5% of the disputed tax, for the purpose of filing an appeal. It also noted the stand taken by the respondent that the employee who was in charge of the tax matters of the respondent, had defaulted and was subsequently suspended in contemplation of disciplinary proceedings, as a result of which statutory appeal could not be filed within the prescribed time. The Division Bench of the High Court directed the respondent to pay an additional amount equivalent to 12.5% of the disputed tax within one week and posted the matter for 19.11.2018. This was an exparte order. The respondent, in terms of the stated order, deposited an additional amount equivalent to 12.5% of the disputed tax amount. The writ petition was then taken up for hearing on 19.11.2018, when after hearing the counsel for the parties, the writ petition came to be allowed and the order passed by the Assistant Commissioner, dated 21.6.2017 has been quashed and set aside and the respondent relegated before the Assistan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred after a period of thirty days if he is satisfied that the VAT dealer or TOT dealer or any other dealer had sufficient cause for not preferring the appeal within that period: Provided further that an appeal so preferred shall not be admitted by the appellate authority concerned unless the dealer produces the proof of payment of tax, penalty, interest or any other amount admitted to be due, or of such instalments as have been granted, and the proof of payment of twelve and half percent of the difference of the tax, penalty, interest or any other amount, assessed by the authority prescribed and the tax, penalty, interest or any other amount admitted by the appellant, for the relevant tax period, in respect of which the appeal is preferred. (2) The appeal shall be in such form, and verified in such manner, as may be prescribed and shall be accompanied by a fee which shall not be less than Rs. 50/ (Rupees fifty only) but shall not exceed Rs. 1000/ (Rupees one thousand only) as may be prescribed. (3) (a) Where an appeal is admitted under subsection (1), the appellate authority may, on an application filed by the appellant and subject to furnishing of such secur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellate authority may make such enquiry as it deems fit or remand the case to any subordinate officer or authority for an inquiry and report on any specified point or points. (6) Every order passed in appeal under this section shall, subject to the provisions of sections 32, 33, 34 and 35 be final." Going by the text of this provision, it is evident that the statutory appeal is required to be filed within 30 days from the date on which the order or proceeding was served on the assessee. If the appeal is filed after expiry of prescribed period, the appellate authority is empowered to condone the delay in filing the appeal, only if it is filed within a further period of not exceeding 30 days and sufficient cause for not preferring the appeal within prescribed time is made out. The appellate authority is not empowered to condone delay beyond the aggregate period of 60 days from the date of order or service of proceeding on the assessee, as the case may be. In the present case, admittedly, the appeal was filed way beyond the total 60 days' period specified in terms of Section 31 of the 2005 Act. In that, the respondent had filed the appeal accompanied by an application for cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EREFORE, it is prayed that the Ld. Appellate Joint Commissioner (ST) be pleased to allow the application for condonation of delay as prayed for." As stated in the application for condonation of delay in filing the statutory appeal, the respondent caused to file affidavit of Mr. Sreedhar Routh, son of Late Mr. R. Seetha Rama Swamy, who was working as Site Director in the respondent company. In this affidavit, in support of the application for condonation of delay, it is averred thus: "..... That Mr. P. Sriram Murthy, Deputy ManagerFinance, was authorized to handle day to day affairs of sales tax (VAT), service tax and excise. He was also authorized to sign and submit documents with the tax departments, file periodic tax returns and represent the company before concerned tax authorities. that the CST assessment for the period 201314 was completed by the Assistant Commissioner (CT) LTU raising demand of Rs. 76,73,197/ vide assessment order dated 21.06.2017. that the assessment order was received by Mr. P. Sriram Murthy. But, the receipt of this assessment order was not informed to any other person of the company. that Mr. P. Sriram Murthy filed applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued an endorsement dt.11.05.2018, rejecting the reassessment request. The appellant also filed an appeal on such endorsement. That appeal petition based on endorsement has also not been admitted in this office and rejected vide ADC's orders no. 3470, dt. 17.08.2018. Therefore, cannot be assumed under any circumstances, and by no stretch of imagination that the appellantdealer was not aware of the service of original assessment orders. Hence, it is to be affirmed that the causes putforth for delay condonation are not rational and against the facts of the case. It is also relevant here to state that whatever may be circumstances, the delay beyond 60 days could not be condonable in the hands of the appellate authority, therefore, such request primafacie is not in tune with the provisions of the Act, hence, liable to be rejected. From the aforesaid discussion, it is construed that no favourable grounds can be made to admit the appeal, since the appellant have failed to file appeal petition within the prescribed time under APVAT Act, 2005. It is also pertinent here to note that the Department has duly served the original assessment order to the appellant without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the statutory appeal including the reason why the respondent should be given one opportunity. The same read thus: "..... 7. From the above, it can be summarized that the total disputed demand has arisen on account of two reasons. Firstly, the 1st Respondent has considered the total branch transfer turnover as per monthly CST returns and ignored the revised turnover as per VAT 200B. Even though, the such revised stock transfer value was considered by the 1st Respondent while computing the ITC credit as per rule 20 (8) of AP VAT act. Secondly, receipt of excess forms on account of inclusion of value of freebies, free samples etc. by receiving state while issuing the F Forms. The 1st Respondent treated these excess F Forms value as concealment by the petitioner and levied tax even, on this branch transfer value duly covered by F Forms which is [sic] grossly against the principle of law. 8. It is submitted that the order was served on the petitioner on 22.6.2017 against which, the Petitioner could have preferred appeal before the 2nd Respondent within 30 days from the said date. Unfortunately, no steps were taken to file any appeal within the due date for the reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under Rule 60. It is also submitted that Mr. P. Sri Ram Murthy appear to have filed an appeal against the endorsement of the 1st Respondent dated 11.5.2018 to 2nd Respondent on 28.5.2018. This was also without knowledge of the petitioner's management. 13. It is submitted that the Petitioner was not aware of these developments till the misdeeds of Mr. P. Sri Ram Murthy were being enquired into. It is submitted that Mr. P. Sri Ram Murthy has in fact, remitted an amount of Rs. 9,59,150/ being 12.5% of the disputed tax in the assessment order online, on 12.9.2017 (Ex. P6). The payment was made as if it is towards miscellaneous tax payment for June, 2014. When the Petitioner was seeking to reconcile as to how this amount was deposited and under what account it came to known it is for the purpose of preferring an appeal against the impugned order. All this verification happened post suspension of Mr. P. Sri Ram Murthy. 14. The Petitioner faced with this unfortunate situation, filed an appeal under Section 31 of the VAT Act on 24.9.2018 on the bona fide belief that there are good grounds for condonation of the delay since the Petitioner cannot suffer for the errors committ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the CST returns and the amount indicated in Form "F" relating to the turnover. The additional reason as can be discerned from the impugned order is that the respondent had already deposited an additional amount equivalent to 12.5% of the disputed tax amount in terms of the earlier order. We deem it apposite to reproduce the impugned order of the High Court. The same reads thus: "..... The impugned order of assessment is dated 21.6.2017. As against the said order the petitioner filed an appeal with a delay. Since the delay was beyond the period after which it can be condoned, the same was not entertained. Therefore, the petitioner has come up with the above writ petition. The reason stated by the petitioner is that one of the employees who was in charge, indulged in malpractices forcing the management to suspend him and initiate disciplinary proceedings. The petitioner claims that they were not aware of these orders. Therefore, the petitioner seeks one opportunity. The reason why the petitioner seeks one opportunity is that 'F' forms submitted by the petitioner were rejected by the Assessing Officer, on the ground that the value of the goods transferred to branch off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on could have availed of an effective alternative remedy in the manner prescribed by law (see Baburam Prakash Chandra Maheshwari vs. Antarim Zila Parishad now Zila Parishad, Muzaffarnagar AIR 1969 SC 556 and also Nivedita Sharma vs. Cellular Operators Association of India & Ors. (2011) 14 SCC 337). In Thansingh Nathmal & Ors. vs. Superintendent of Taxes, Dhubri & Ors. AIR 1964 SC 1419, the Constitution Bench of this Court made it amply clear that although the power of the High Court under Article 226 of the Constitution is very wide, the Court must exercise selfimposed restraint and not entertain the writ petition, if an alternative effective remedy is available to the aggrieved person. In paragraph 7, the Court observed thus: "7. Against the order of the Commissioner an order for reference could have been claimed if the appellants satisfied the Commissioner or the High Court that a question of law arose out of the order. But the procedure provided by the Act to invoke the jurisdiction of the High Court was bypassed, the appellants moved the High Court challenging the competence of the Provincial Legislature to extend the concept of sale, and invoked the extraordinary juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners have the right to prefer an appeal before the Prescribed Authority under subsection (1) of Section 23 of the Act. If the petitioners are dissatisfied with the decision in the appeal, they can prefer a further appeal to the Tribunal under subsection (3) of Section 23 of the Act, and then ask for a case to be stated upon a question of law for the opinion of the High Court under Section 24 of the Act. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under Article 226 of the Constitution. It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of. This rule was stated with great clarity by Willes, J. in Wolverhampton New Waterworks Co. v. Hawkesford [(1859) 6 CBNS 336, 356] in the following passage: There are three classes of cases in which a liability may be established founded upon statute. . . . But there is a third class, viz. where a liability not existing at common law is created by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the delay in terms of Section 125 of the Electricity Act, 2003 was only 60 days. In other words, the appeal was presented beyond the condonable period of 60 days. As a result, this Court could not have condoned the delay of 71 days. Notably, while admitting the appeal, the Court had condoned the delay in filing the appeal. However, at the final hearing of the appeal, an objection regarding appeal being barred by limitation was allowed to be raised being a jurisdictional issue and while dealing with the said objection, the Court referred to the decisions in Singh Enterprises vs. Commissioner of Central Excise, Jamshedpur & Ors. (2008) 3 SCC 70, Commissioner of Customs And Central excise vs. Hongo india private limited & anr. (2009) 5 SCC 791, chhattisgarh state electricity board vs. Central electricity regulatory commission & ors. (2010) 5 SCC 23 and suryachakra power corporation limited vs. electricity department represented by its superintending engineer, port blair & ors. (2016) 16 SCC 152 and concluded that Section 5 of the Limitation Act, 1963 cannot be invoked by the Court for maintaining an appeal beyond maximum prescribed period in Section 125 of the Electricity Act. 13. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision has been clarified by a Constitution Bench in Union Carbide Corpn. v. Union of India, (1991) 4 SCC 584, wherein M.N. Venkatachaliah, J. (as his Lordship then was) speaking for the majority, ruled that: (SCC pp. 63435, para 83) "83. It is necessary to set at rest certain misconceptions in the arguments touching the scope of the powers of this Court under Article 142(1) of the Constitution. These issues are matters of serious public importance. The proposition that a provision in any ordinary law irrespective of the importance of the public policy on which it is founded, operates to limit the powers of the Apex Court under Article 142(1) is unsound and erroneous. In both Prem Chand Garg v. Excise Commr., AIR 1963 SC 996, as well as A.R. Antulay v. R.S. Nayak, (1988) 2 SCC 602, cases the point was one of violation of constitutional provisions and constitutional rights. The observations as to the effect of inconsistency with statutory provisions were really unnecessary in those cases as the decisions in the ultimate analysis turned on the breach of constitutional rights. We agree with Shri Nariman that the power of the Court under Article 142 insofar as quashing of crimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court Bar Assn. v. Union of India, (1998) 4 SCC 409] opined: (SCC pp. 43738, para 56) "56. As a matter of fact, the observations on which emphasis has been placed by us from the Union Carbide case [Union Carbide Corpn. v. Union of India, (1991) 4 SCC 584], A.R. Antulay case [A.R. Antulay v. R.S. Nayak, (1988) 2 SCC 602] and Delhi Judicial Service Assn. v. State of Gujarat, (1991) 4 SCC 406, go to show that they do not strictly speaking come into any conflict with the observations of the majority made in Prem Chand Garg case [Prem Chand Garg v. Excise Commr., AIR 1963 SC 996]. It is one thing to say that "prohibitions or limitations in a statute" cannot come in the way of exercise of jurisdiction under Article 142 to do complete justice between the parties in the pending "cause or matter" arising out of that statute, but quite a different thing to say that while exercising jurisdiction under Article 142, this Court can altogether ignore the substantive provisions of a statute, dealing with the subject and pass orders concerning an issue which can be settled only through a mechanism prescribed in another statute. This Court did not say so in Union Carbide case [Union Carbide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation Act. It fundamentally relied on M.P. Steel Corpn. v. CCE, (2015) 7 SCC 58, wherein the Court after referring to certain authorities, analysed thus: (M.P. Steel Corpn. Case), SCC p. 91, para 43) "43. ... when a certain period is excluded by applying the principles contained in Section 14, there is no delay to be attributed to the appellant and the limitation period provided by the statute concerned continues to be the stated period and not more than the stated period. We conclude, therefore, that the principle of Section 14 which is a principle based on advancing the cause of justice would certainly apply to exclude time taken in prosecuting proceedings which are bona fide and with due diligence pursued, which ultimately end without a decision on the merits of the case."" (emphasis in italics - in original, and in bold - supplied) Similarly, in State vs. Mushtaq Ahmad & ors. (2016) 1 SCC 315, this Court opined that where minimum sentence is provided for an offence then no Court can impose lesser punishment on ground of mitigating factors. 14. A priori, we have no hesitation in taking the view that what this Court cannot do in exercise of its plenary powers under Article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt with the legislative intent regarding the dispensation explicitly prescribed under Section 31 of the 2005 Act. That would render the legislative scheme and intention behind the stated provision otiose. 16. The respondent had relied on the decision of this Court in K.s. Rashid & son vs. The income tax investigation commission AIR 1954 SC 207. This decision of the Constitution Bench, no doubt, deals with the extent of power of the High Court under Article 226 of the Constitution and the situation when the High Court can refuse to exercise its discretion, such as when alternative efficacious remedy is available to the aggrieved party. In paragraph 4 (last paragraph) of this decision, however, the Court plainly noted that it was not necessary to express any final opinion on the question as to whether Section 8(5) of the Taxation on Income (Investigation Commission) Act, 1947 (Act XXX of 1947) is to be regarded as providing the only remedy available to the aggrieved party and that it excludes altogether the remedy provided for under Article 226 of the Constitution. 17. Reliance was then placed on a threeJudge Bench decision of this Court in ITC Ltd. & Anr. Vs. Union of india ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in good faith by the assessee (appellant). 18. Suffice it to observe that this decision is on the facts of that case and cannot be cited as a precedent in support of an argument that the High Court is free to entertain the writ petition assailing the assessment order even if filed beyond the statutory period of maximum 60 days in filing appeal. The remedy of appeal is creature of statute. If the appeal is presented by the assessee beyond the extended statutory limitation period of 60 days in terms of Section 31 of the 2005 Act and is, therefore, not entertained, it is incomprehensible as to how it would become a case of violation of fundamental right, much less statutory or legal right as such. 19. Arguendo, reverting to the factual matrix of the present case, it is noticed that the respondent had asserted that it was not aware about the passing of assessment order dated 21.6.2017 although it is admitted that the same was served on the authorised representative of the respondent on 22.6.2017. The date on which the respondent became aware about the order is not expressly stated either in the application for condonation of delay filed before the appellate authority, the affidavit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m Murthy, Deputy ManagerFinance) or at least the other employee [Siddhant Belgaonker, Senior Manager (Finance)], who was associated with the erring employee during the relevant period, has been filed in support of the stand taken in the application for condonation of delay. Pertinently, no finding has been recorded by the High Court that it was a case of violation of principles of natural justice or noncompliance of statutory requirements in any manner. Be that as it may, since the statutory period specified for filing of appeal had expired long back in August, 2017 itself and the appeal came to be filed by the respondent only on 24.9.2018, without substantiating the plea about inability to file appeal within the prescribed time, no indulgence could be shown to the respondent at all. 20. Reverting to the contention that the respondent having failed to assail the order passed by the appellate authority, dated 25.10.2018 rejecting the application for condonation of delay, the assessment order passed by the Assistant Commissioner, dated 21.6.2017 stood merged, need not detain us in view of the exposition of this Court in Raja Mechanical Company Private Limited vs. Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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