Telangana High Court

Laxmi Venkateshwara Agencies vs The Assistant Commissioner Central Tax on 18 June, 2024

              THE HONOURABLE SRI JUSTICE SUJOY PAUL

                                    AND

     THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO

                   WRIT PETITION No.5473 of 2024

ORDER:

(per Hon'ble Sri Justice Sujoy Paul)

Sri T.S.Murthy, learned counsel for the petitioner and Ms. B.

Swapna Reddy, Senior Standing Counsel for CBIC, representing Sri

Gadi Praveen Kumar, Deputy Solicitor General of India.

2. Heard on admission.

3. This Petition filed under Article 226 of the Constitution takes

exception to the order dated 12.09.2023 (annexure P-1) vide Order-

in-Original No. 208/2023-24-S.Tax issued by the first respondent.

This assessment order is called in question in this petition directly

by contending:

(i) the impugned order is founded upon certain show-cause

notices, which were issued beyond the statutory period of

limitation of thirty months under Section 73 (1) of the

Finance Act.

(ii) The show-cause notices were served through E-mail

whereas the Act nowhere prescribes any such mode of

service through E-mail

(iii) the petitioner filed his replies and placed reliance on

certain High Courts and Supreme Court judgments. Since the

impugned order is not a reasoned order and all the

contentions raised by the petitioner were not considered by the

first respondent by placing reliance on two judgments i.e.

Steel Authority of India Ltd. Vs. Sales Tax Officer,

Rourkela-I Circle and others 1 and Ravi Gupta Vs.

Commissioner of Sales Tax, Delhi and another 2, it is urged

that if the 'conclusion' is not founded upon the 'reasons', the

impugned order pregnant with such conclusion becomes

vulnerable and liable to be set aside.

(iv) The petitioner is not a registered body as mentioned in

the impugned Order and, therefore, for this reason also, the

impugned Order is bad in law. Since there is serious violation

of principles of natural justice and Departmental

Notifications/Circulars, the impugned order is liable to be

interfered with, more so, when the assessment is not

completed within the stipulated time.

Ms. B. Swapna Reddy, Senior Standing Counsel for CBIC,

opposed the prayer by submitting that there is no procedural flaw in

the decision making process. The petitioner has a statutory remedy

(2008) 16 VST 181 (SC)

(2009) 22 VST 529 (SC)

of appeal and all these aspects can be gone into by the Appellate

Authority. The petitioner was given an opportunity to file reply as

well as an opportunity of personal hearing.

4. We have heard the parties on this aspect.

5. 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.

6. No doubt, in the case of Whirlpool Corporation v. Registrar

of Trade Marks, Mumbai 3 it was held that the Writ Petition can be

entertained despite availability of statutory alternative remedy in

certain situations like;

i) When violation of principles of natural justice takes place.

ii) When fundamental rights are breached.

iii) When the vires of the provision itself is called in question

iv) When the order passed by an incompetent authority,

3 (1998) 8 SCC 1

This judgment of Whirlpool Corporation (supra) was

considered by the Supreme Court in U.P. State Spinning Co. Ltd. v.

R.S. Pandey and Another 4 and it was opined as under:-

"17. ...But normally, the High Court should not entertain writ petitions unless it is shown that there is something more in a case, something going to the root of the jurisdiction of the officer, something which would show that it would be a case of palpable injustice to the writ petitioner to force him to adopt the remedies provided by the statute...."

(Emphasis supplied)

7. In our considered opinion, the existence of these aspects give

discretion to the Court and can't be treated as compulsion. In R.S.

Pandey (supra) 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.

8. There is no cavil of doubt that despite availability of statutory

alternative remedy, a Writ Petition under Article 226 of the

(2005) 8 SCC 264

Constitution can be entertained in certain circumstances. However,

breach of natural justice, procedural impropriety, etc., can be looked

into by the appellate authority also. The Apex Court in its recent

judgment dated 10.04.2024 in the case of PHR Invent Educational

Society Vs. UCO Bank and Others 5 disapproved the order of

Telangana High Court in W.P.No.5275 of 2021, dated 04.02.2022,

wherein a Division Bench of this Court entertained a Writ Petition

despite availability of alternative remedy. The Apex Court opined as

under:

"15. It could thus be seen that, this Court has clearly held that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person. It has been held that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. The Court clearly observed that, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc., the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. It has been held that, though the powers of the High Court under Article 226 of the Constitution are of widest amplitude, still the Courts cannot be oblivious of the rules of self-imposed restraint evolved by this Court. The Court further held that though the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, still it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution."

(Emphasis Supplied)

(2024) 4 S.C.R. 541

9. In the aforesaid judgment, 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.

10. 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.

11. We find no reason to bypass the alternative remedy and deem it