BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 10/08/2011
CORAM
THE HONOURABLE MR. JUSTICE VINOD K.SHARMA
W.P.(MD)No.10154 of 2006
Shanthi Trading Company,
represented by its Proprietor-David Chelladurai
No.22-C, Kulasekaranathar Koil Street,
Tenkasi,
Tirunelveli District. ..Petitioner
Vs
1. The Commercial Tax Officer (FAC),
Tenkasi,
Tirunelveli District.
2. The Deputy Commercial Tax Officer(Enf),
Tirunelveli.
3. The Special Commissioner and
Commissioner of Commercial Taxes,
Special Committee(CT),
Chepauk,
Chennai-5.
4. The Secretary to Government,
Commercial Tax Department,
Special Committee(CT),
Fort St.George,
Chennai-9.
5. The Secretary to Government,
Finance Department,
Special Committee(CT),
Fort St.George,
Chennai-9. ..Respondents.
!For Petitioner ... M/s.M.Md.Ibrahim Ali
^For Respondents ... Mr.D.Muruganandam
Addl.Govt.Pleader
Prayer
Writ Petition filed under Article 226 of the Constitution of India,
praying this Court to issue a Writ of Certiorarified Mandamus calling for the
records relating to the order passed by the Committee consists of the
respondents 3 to 5 and to direct the Special Committee consists of respondents
3 to 5 in SCP No.29/2006(CCT/M3/44346), dated 13.09.2006 and to quash the same
and to direct the Special Committee consists of respondents 3 to 5 to pass
orders on the petition submitted by the petitioner on 7.11.2005.
:ORDER
The petitioner has invoked the writ jurisdiction of this Court under
Article 226 of the Constitution of India, praying for issuance of a Writ in the
nature of Certiorari to quash the order dated 13.09.2006, passed by the Special
Committee under Section 16-D of the Tamil Nadu General Sales Tax Act, 1959.
2. In support of the prayer, it is the pleaded case of the petitioner,
that the petitioner is a dealer of Beedi Leaves and Tobacco carrying on business
in the name of ‘Shanthi Trading Company’ at Tenkasi. The place of business of
the petitioner was inspected by the officials of the Enforcement Wing on
29.04.2003 in the absence of the Proprietor of the firm. At that time, only
sales bill were kept as the Account Books were under lock and key. It is for
this reason, the person in-charge at the time of inspection could not produce
the account books before the officials of the Enforcement Wing. The Inspecting
officers secured 11 slips of papers containing business transactions and for
want of account books treated it to be suppression and recorded the statement
of person in-charge.
3. It is the case of the petitioner that after recording of the statement
on 28.10.2003, the petitioner was given an opportunity of hearing in the
enquiry. At the time of enquiry, the Deputy Commercial Tax Officer, Tenkasi
recorded that entire 11 slips stood accounted for and there is no suppression of
sales transaction.
4. Thereafter, contrary to this fact, the Deputy Commercial Tax Officer
assessed the tax by treating these slips to be suppression of turn over.
5. The petitioner has the statutory remedy of appeal under Section 31 of
the Tamil Nadu General Sales Tax Act, 1959, against the orders passed by the
Deputy Commercial Tax Officer.
6. Section 31 of the Act reads as under:
31. Appeal to the Appellate Assistant Commissioner.–(1) Any person
objecting to an order passed by the appropriate authority under Section 4-A,
sub-section (3) of Section 10, Section 12, Section 12-A, Section 14, Section 15,
sub-sections(1) and (2) of Section 16, Section 18, sub-sections(2) of Section
22, Section 23 or Section 27 other than an order passed by an Assistant
Commissioner(Assessment) may, within a period of thirty days from the date on
which the order was served on him in the manner prescribed, appeal against such
order to the Appellate Assistant Commissioner having jurisdiction.:
Provided that the Appellate Assistant Commissioner may, within a further
period of thirty days admit an appeal presented after the expiration of the
first mentioned period of thirty days if he is satisfied that the appellant had
sufficient cause for not presenting the appeal within the first mentioned
period;
Provided further that in the case of an order under sub-section (3) of
Section 10, Section 12, Section 12-A,Section 14, Section 15 or sub-sections (1)
and (2) of Section 16, no appeal shall be entertained under this sub-section
unless it is accompanied by satisfactory proof of the payment of the tax
admitted by the appellant to be due of such instalments thereof as might have
become payable, as the case may be, and (twenty-five) per cent of the difference
of the tax assessed by the assessing authority and the tax admitted by the
appellant.
(2) The appeal shall be in the prescribed form and shall be verified in
the prescribed manner and shall be accompanied by such fee not exceeding one
hundred rupees as may be prescribed.
(3) In disposing of an appeal, the Appellate Assistant Commissioner may,
after giving the appellant a reasonable opportunity of being heard, and for the
sufficient reasons to be recorded in writing–
(a) in the case of an order of assessment–
(i) confirm, reduce, enhance or annul the assessment or the penalty or
both;
(ii) set aside the assessment and direct the assessing authority to make a
fresh assessment after such further inquiry as may be directed; or
(iii) pass such other orders as he may think fit; or
(b) in the case of any other order, confirm, cancel or vary such order;
Provided that at the hearing of any appeal, the appropriate authority
shall have the right to be heard either in person or by a representative.
(4) Omitted by Act No.31 of 1972 w.e.f. 1st December 1972.
(5) Notwithstanding that an appeal has been preferred under sub-section
(1), the tax shall be paid in accordance with the order of assessment against
which the appeal has been preferred;
Provided that the Appellate Assistant Commissioner may, in his discretion,
give such directions as he thinks fit in regard to the payment of the tax before
the disposal of the appeal, if the appellant furnishes sufficient security to
his satisfaction, in such form and in such manner as may be prescribed.
7. The petitioner instead of availing the appeal remedy filed a
representation with the appellate authority showing his inability to deposit 25%
of the tax.
8. The petitioner thereafter invoked Section 16-D of the Tamil Nadu
General Sales Tax Act, 1959, which reads as under:
16-D. Constitution of Special Committee.–(1) The Government shall appoint
a Special Committee consisting of (1) Secretary to Government, Commercial Taxes
Department (2) Commissioner of Commercial Taxes; (3) Secretary to Government,
Finance Department or his nominee.
(2)Notwithstanding anything contained in this Act, the Special Committee
may, of its own motion or on application, call for and examine the records of
the assessing authority in respect of any proceeding or order under sub-
section(2) or (3) of Section 12 or sub-section(1) and (2) of Section 16, if such
proceeding or order is passed in violation of the provisions of the Act or rules
made thereunder or without following the principles of natural justice, set
aside the said proceeding or order and direct the assessing authority to make a
fresh assessment and pass fresh proceeding or order in such manner as may be
directed.
Provided that such proceeding or order against which any appeal or writ is
pending shall not be entertained under this sub-section.
(3) The order passed under sub-section(2) shall be final.
9. The Special Committee under Section 16-D dismissed the application, by
recording a finding that there was no violation of rules or principles of
natural justice or violative of statutory provision of the act or rules which
could entitle the Committee to exercise suo-motu power or on an application of
the petitioner to enter with the orders passed by the Deputy Commercial Tax
Officer.
10. The learned counsel for the petitioner has challenged the impugned
order by contending that the order passed by the Special Committee under Section
16-D in exercise of quasi judicial power is not a speaking order, as it has not
dealt with the grounds raised by the petitioner in the application filed by the
petitioner to challenge the order of the Deputy Commercial Tax Officer.
11. In support of this contention, the learned counsel for the petitioner
vehemently contended, that the reading of assessment order itself reveal that
the Deputy Commercial Tax Officer after giving opportunity of hearing to the
petitioner had recorded a finding that 11 slips recovered at the time of
inspection stood accounted for. Inspite of the positive finding while passing
the order of assessment, a contrary finding to the one observed above is
recorded holding that there was suppression of turnover shown in the 11 slips,
recovered at the time of inspection and the impugned order, was passed.
12. The contention of the learned counsel for the petitioner, is that the
impugned order cannot be sustained, as it is outcome of non-application of mind,
as no reasons have been recorded to reject this contention.
13. On consideration, I find no ground to interfere with the order under
Section 16-D of the Tamil Nadu General Sales Tax Act as the Special Committee
was right in dismissing the application on the ground that there was no
violation of statutory provisions of the rules nor there was no violation of
principles of natural justice.
14. A reading of Section 16-D shows that this is a special provision
vesting jurisdiction with the Special Committee, to exercise suo-motu power or
on an application of the party, in case, the order is patently bad being
violative of principles of natural justice or is in violation of statutory
provisions of law.
15. Section 16-D is not a substitute for statutory appeal. The contention
raised by the petitioner at best can show the order passed by the Deputy
Commercial Tax Officer was bad in law, but it was not an order which was lacked
jurisdiction or was in violation of statutory provisions of law or in violation
of principles of natural justice.
16. The contention of the learned counsel for the petitioner that the
exercise under Section 16-D can also be exercised when the order is illegal
cannot be accepted.
17. The Legislature did not enact Section 16-D to by-pass the statutory
remedy of appeal. It was for the petitioner to file an appeal and in case of
inability to deposit the tax he could have approached the appellate authority
for deciding the appeal without insisting for furnishing of deposit of tax at
25% therein by furnishing security as provided under Section 31 of the Tamil
Nadu General Sales Tax Act.
18. As already held above, in view of the availability of statutory
appeal, and there being no violation of statutory provisions or of natural
justice, the application filed by the petitioner was rightly rejected by the
Special Committee, which does not call for any interference by this Court in
exercise of extraordinary equitable jurisdiction under Article 226 of the
Constitution of India.
19. Finding no merits, the Writ Petition is dismissed.
20. No costs.
21. However petitioner shall be at liberty to challenge the assessment
order in appeal, if so advised. Keeping in view the fact that the petitioner
bona fide filed a petition under Section 16-D and thereafter, approached this
Court by way of this Writ, in case appeal is filed in accordance with law,
within 30 days of receipt of certified copy of this order. The appellate
authority shall decide it on merit by treating it to be filed within limitation.
vsn
To
1. The Commercial Tax Officer (FAC),
Tenkasi,
Tirunelveli District.
2. The Deputy Commercial Tax Officer(Enf),
Tirunelveli.
3. The Special Commissioner and
Commissioner of Commercial Taxes,
Special Committee(CT),
Chepauk,
Chennai-5.
4. The Secretary to Government,
Commercial Tax Department,
Special Committee(CT),
Fort St.George,
Chennai-9.
5. The Secretary to Government,
Finance Department,
Special Committee(CT),
Fort St.George,
Chennai-9.