Madras High Court
M/S.Hari & Co vs The State Of Tamil Nadu on 5 October, 2021
W.A.No.2567 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 05.10.2021
CORAM
THE HON'BLE MR.JUSTICE T.S.SIVAGNANAM
and
THE HON'BLE MR.JUSTICE SATHI KUMAR SUKUMARA KURUP
Writ Appeal No.2567 of 2021
and C.M.P.No.16716 of 2021
M/s.Hari & Co.,
No.133, G.C.Road,
Tuticorin – 1. .. Appellant
-vs-
1.The State of Tamil Nadu,
Rep. by its Secretary,
Commercial Taxes Department,
Fort St. George, Chennai – 600 009.
2.The Commissioner of Commercial Taxes,
Ezhilagam, Chepauk,
Chennai – 600 005.
3.The Commercial Tax Officer II (FAC)
Office of Commercial Tax Officer,
Tuticorin. .. Respondents
Appeal under Clause 15 of Letters Patent against the order dated
10.11.2020 in W.P.No.7740 of 2006 and set aside the same.
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W.A.No.2567 of 2021
For Appellant : Mr.V.Sundareswaran
For Respondents : Mr. M.Venkateswaran
Government Counsel
JUDGMENT
(Delivered by T.S.Sivagnanam, J.)
This appeal by the writ petitioner is directed against the order dated
10.11.2020 in W.P.No.7740 of 2006.
2.By the said order, a demand for payment of entry tax under the
provisions of the Tamil Nadu Tax on Entry of Motor Vehicles to Local
Areas Act, 1990 ['the Act' for brevity] was made on the appellant together
with twice the amount of tax as penalty. The writ petition was filed in the
year 2006 and the same was entertained and an order of interim stay was
granted. The writ petition was finally heard during November 2020 and we
find that no counter affidavit had been filed by the respondents. The
learned Single Bench dismissed the writ petition on two grounds. Firstly,
on the ground that the writ petition should have been filed before the
Madurai Bench of this Court and not in the Principal Seat as the order
which was put to challenge was passed by the third respondent who is
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W.A.No.2567 of 2021
within the jurisdiction of the Madurai Bench. The second reason for
dismissing the writ petition is that the appellant without exhausting the
alternative remedy could not have filed the writ petition. The correctness of
the order is being questioned in this appeal.
3.We have heard Mr.V.Sundareswaran, learned counsel appearing for
the appellant and Mr.M.Venkateswaran, learned Government Counsel
appearing for the respondents.
4.It may be true that the writ petition had been filed challenging an
order passed by the third respondent, who is admittedly within the
jurisdiction of the Madurai Bench of this Court. However, in the grounds
raised in the writ petition, the appellant has questioned the jurisdiction of
the authority, namely, the third respondent, classifying the equipment as
Motor Vehicle. The third respondent had relied on a Government Order in
G.O.Ms.No.443, Home [Tr.V] Department dated 30.04.2001 to justify the
demand of entry tax. Furthermore, the third respondent has referred to and
relied upon a clarification issued by the second respondent under Section
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W.A.No.2567 of 2021
28A of the Act. Therefore, the respondents while filing a counter affidavit
will have to take a stand as regards the applicability of G.O.Ms.443, Home
[Tr.V] Department dated 30.04.2001 and the effect of the Circular issued by
the second respondent. Therefore, a specific stand was required to be taken
by the first and second respondents and not only by the third respondent.
As pointed out earlier, none of the respondents had filed counter affidavit in
the writ petition though the same was pending from the year 2006. That
apart, the petitioner had also filed a representation to the second respondent
under Section 28A of the Act requesting for clarification and the charges
which was stipulated had also been remitted. The said request for
clarification dated 26.01.2006 submitted by the appellant through their
counsel was not taken up for consideration. All the above factors put
together will go to show that the writ petition can be entertained by the
Principal Seat.
5.Having steered clear of this issue, we consider as to the correctness
of the other ground on which the writ petition was dismissed, namely, on
the ground on not availing alternative remedy provided under the provisions
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W.A.No.2567 of 2021
of the Act. The appellant has challenged the order passed by the third
respondent as being without jurisdiction and in violation of the principles of
natural justices and ab initio void. If such was the contention raised, the
respondents are duty bound to define the matter by placing materials before
the Court and if the appellant is able to satisfy the Court that the demand
raised by the third respondent is without jurisdiction or there has been
violation of principles of natural justice, then the writ petition is
maintainable. Having said so, we have examined the order dated
23.02.2006 which is an assessment order under Section 8/9 of the Act which
was impugned in the writ petition. Though the third respondent states that
the appellant had filed additional objections on 21.02.2006, the third
respondent has recorded a finding that no fresh grounds have been pointed
out by the appellant. On going through the second objection dated
21.02.2006, we find that the additional grounds have been raised by the
appellant, more particularly on the issue whether a Reach Stacker is a heavy
capacity mobile crane or a construction equipment. Therefore, the third
respondent is not correct in observing that no additional grounds have been
raised by the appellant. That apart, the levy of penalty twice the amount of
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W.A.No.2567 of 2021
tax has also been questioned by the appellant on the ground that unless and
until the third respondent has specifically recorded a finding of wilful
disobedience of any of the statutory provisions, penalty cannot be levied.
Admittedly, the appellant has filed the return under Section 7 of the Act.
Thus, the question would be whether levy of penalty was justified or not.
6.That apart, the third respondent while passing the assessment order
has relied upon a Government Order in G.O.Ms.No.443 dated 30.04.2001
with regard to the classification of the equipment. We find that the
appellant did not have adequate opportunity to putforth their objections as
there was no such proposal made by the third respondent before the
impugned order was passed. Further, the appellant has raised a specific plea
that the equipment would not fall within the definition of Motor Vehicle as
defined under Section 2(28) of the Motor Vehicles Act and that the
equipment which was purchased by the appellant is not adopted for use of
public roads and therefore, the provisions with the Act itself would not be
attracted. These issues required to be considered in an appropriate manner
after adequate opportunity to the appellant which we find has not been
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W.A.No.2567 of 2021
provided. For the above reasons, we are inclined to interfere with the
assessment order and remand the matter to the third respondent for fresh
consideration.
7.In the result, the writ appeal is allowed, the order passed in the writ
petition is set aside. Consequently, the writ petition is allowed and the
assessment order dated 23.02.2006 is set aside and the matter is remanded to
the third respondent for fresh consideration. The appellant is at liberty to
file additional objections to the pre-assessment notice within fifteen days
from the date of receipt of a copy of this judgment. Thereafter, the third
respondent shall afford an opportunity of personal hearing to the authorized
representative of the appellant and consider all the materials that may be
placed before him and re-do the assessment in accordance with law. No
costs. Consequently, connected miscellaneous petition is closed.
(T.S.S., J.) (S.S.K., J.)
05.10.2021
Index: Yes/ No
Speaking Order : Yes/ No
cse
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W.A.No.2567 of 2021
T.S.Sivagnanam, J.
and
Sathi Kumar Sukumara Kurup, J.
cse
To
1.The Secretary,
Commercial Taxes Department,
Fort St. George, Chennai – 600 009.
2.The Commissioner of Commercial Taxes,
Ezhilagam, Chepauk, Chennai – 600 005.
3.The Commercial Tax Officer II (FAC)
Office of Commercial Tax Officer,
Tuticorin.
W.A.No.2567 of 2021
05.10.2021
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