Constitution of India:
Art. 226 – Jurisdiction under – Scope of – Assessment under Andhra Pradesh Value Added Tax Act, 2005 – Appeal against assessment order filed beyond limitation period with application for condonation of delay – Appeal dismissed as barred by limitation – Writ Petition u/Art. 226 seeking to quash the assessment order – High Court quashed the assessment order relegating the assessee to Assessing Officer for reconsideration of the matter afresh – Appeal to Supreme Court – Held: Where a right or liability is created by a statute, giving a special remedy for enforcing it, remedy provided by the statute only must be availed of – The wide jurisdiction of High Court provided u/Art. 226, does not mean that it can pass order in disregard of the substantive provisions of a statute – The statutory appeal was filed beyond the total 60 days’ period specified in s.31 of 2005 Act – The appellate authority is not empowered to condone delay of the aggregate period of 60 days – Since the statutory period specified for filing the appeal had expired and appeal was filed without substantiating the ground for delay in filing the appeal, no indulgence could be shown to the assessee – the writ petition deserved to be rejected at the threshold. Doctrine:
Doctrine of merger – Rejection of condonation of delay application by appellate forum does not entail in merger of the assessment order with that order.
Allowing the appeal, the Court
HELD: 1. It is evident from s. 31 of Andhra Pradesh Value Added Tax Act, 2005 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. [Para 8][614-D-F]
2. The appellate authority vide order dated 25.10.2018, considered the reasons offered by the respondent for the delay in filing of the appeal and concluded that the same were not substantiated with sufficient cause, and that the delay beyond the period of 60 days from the date of service of the assessment order on the respondent-assessee cannot be condoned. [Para 8][617-B]
3. The High Court finally allowed the writ petition on the ground that the statutory remedy had become ineffective for the respondent (writ petitioner) due to expiry of 60 days from the date of service of the assessment order. Inasmuch as, the appellate authority had no jurisdiction to condone the delay after expiry of 60 days, despite the reason mentioned by the respondent of an extraordinary situation due to the act of commission and omission of its employee who was in charge of the tax matters, forcing the management to suspend him and initiate disciplinary proceedings against him. Soon after becoming aware about the assessment order, the respondent had filed the appeal, but that was after expiry of 60 days’ period. The High Court was also impressed by the contention pressed into service by the respondent that it ought to be given one opportunity to explain to the authority (Assistant Commissioner) about the discrepancies between the value reported in 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. [Para 10][622-A-E]
4. Even though the High Court can entertain a writ petition against any order or direction passed/action taken by the State under Article 226 of the Constitution, it ought not to do so as a matter of course when the aggrieved person could have availed of an effective alternative remedy in the manner prescribed by law. 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. [Para 11][623-H; 624-A-C]
Nivedita Sharma v. Cellular Operators Association of India & Ors. (2011) 14 SCC 337 ; Thansingh Nathmal & Ors. v. Superintendent of Taxes, Dhubri & Ors. AIR 1964 SC 1419 : [1964] 6 SCR 654 - followed.
Baburam Prakash Chandra Maheshwari v. Antarim Zila Parishad now Zila Parishad, Muzaffarnagar AIR 1969 SC 556 : [1969] SCR 518 – relied on.
5. Where a right or liability is created by a statute, which gives a special remedy for enforcing it, the remedy provided by that statute must only be availed of. [Para 11][625-E] Titaghur Paper Mills Co. Ltd. & Anr. v. State of Orissa & Ors. (1983) 2 SCC 433 : [1983] 2 SCR 743 – relied on.
6. The fact that the High Court has wide jurisdiction under Article 226 of the Constitution, does not mean that it can disregard the substantive provisions of a statute and pass orders which can be settled only through a mechanism prescribed by the statute. [Para 11][626-G]
Mafatlal Industries Ltd. & Ors. v. Union of India & Ors. (1997) 5 SCC 536 : [1996] 10 Suppl. SCR 585 – relied on.
7. Indubitably, the powers of the High Court under Article
226 of the Constitution are wide, but certainly not wider than the plenary powers bestowed on this Court under Article 142 of the Constitution. Article 142 is a conglomeration and repository of the entire judicial powers under the Constitution, to do complete justice to the parties. Even while exercising that power, this Court is required to bear in mind the legislative intent and not to render the statutory provision otiose. What this Court cannot do in exercise of its plenary powers under Article 142 of the Constitution, it is unfathomable as to how the High Court can take a different approach in the matter in reference to Article
226 of the Constitution. [Paras 12 and 14][627-A-B; 632-E-F]
Oil and Natural Gas Corporation Limited v. Gujarat Energy Transmission Corporation Limited & Ors. (2017)
5 SCC 42 : [2017] 2 SCR 922; Singh Enterprises v. Commissioner of Central Excise, Jamshedpur & Ors. (2008) 3 SCC 70 : [2007] 13 SCR 952 ; Commissioner of Customs and Central Excise v. Hongo India Private Limited & Anr. (2009) 5 SCC 791 ; Chhattisgarh State Electricity Board v. Central Electricity Regulatory Commission & Ors. (2010) 5 SCC 23 : [2010] 4 SCR
680 ; Suryachakra Power Corporation Limited v. Electricity Department represented by its
Superintending Engineer, Port Blair & Ors. (2016) 16 SCC 152 : [2016] 8 SCR 108 ; State v. Mushtaq Ahmad & Ors. (2016) 1 SCC 315 : [2015] 15 SCR 452
– relied on.
8. In a given case, the assessee may approach the High Court before the statutory period of appeal expires to challenge the assessment order by way of writ petition on the ground that the same is without jurisdiction or passed in excess of jurisdiction - by overstepping or crossing the limits of jurisdiction including in flagrant disregard of law and rules of procedure or in violation of principles of natural justice, where no procedure is specified. The High Court may accede to such a challenge and can also non-suit the petitioner on the ground that alternative efficacious remedy is available and that be invoked by the writ petitioner. However, if the writ petitioner choses to approach the High Court after expiry of the maximum limitation period of 60 days prescribed under Section 31 of the 2005 Act, the High Court cannot disregard the statutory period for redressal of the grievance and entertain the writ petition of such a party as a matter of course. The fact that the High Court has wide powers, does not mean that it would issue a writ which may be inconsistent 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. [Para 15][633-B-E]
K.S. Rashid & Son v. the Income Tax Investigation Commission AIR 1954 SC 207 : [1954] SCR 738; ITC Ltd. & Anr. v. Union of India (1998) 8 SCC 610 – distinguished.
Electronics Corporation of India Ltd. v. Union of India & Ors. 2018 (361) ELT 22 (A.P.) ; Panoli Intermediate (India) Pvt. Ltd. v. Union of India & Ors. AIR 2015 Guj 97 ; Phoenix Plasts Company v. Commissioner of Central Excise (Appeal-I), Bangalore 2013 (298) ELT
481 (Kar.) — not approved.
9. 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. [Para 18][635-C-D]
10.1 In the present case, 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 filed in support of the said application or for that matter, in the memo of writ petition. On the other hand, it is seen that the amount equivalent to 12.5% of the tax amount came to be deposited on 12.9.2017 for and on behalf of respondent, without filing an appeal and without any demur - after the expiry of statutory period of maximum 60 days, prescribed under Section 31 of the 2005 Act. Not only that, the respondent filed a formal application under Rule 60 of the 2005 Rules on 8.5.2018 and pursued the same in appeal, which was rejected on 17.8.2018. [Para 19][635-D-G]
10.2 Furthermore, the appeal in question against the assessment order came to be filed only on 24.9.2018 without disclosing the date on which the respondent in fact became aware about the existence of the assessment order dated 21.6.2017. On the other hand, in the affidavit of the Site Director of the respondent company (filed in support of the application for condonation of delay before the appellate authority), it is stated that the company became aware about the irregularities committed by its erring official in the month of July, 2018, which pre-supposes that the respondent must have become aware about the assessment order, at least in July, 2018. In the same affidavit, it is asserted that the respondent company was not aware about the assessment order, as it was not brought to its notice by the employee concerned due to his negligence. The respondent in the writ petition has averred that the appeal was rejected by the appellate authority on the ground that it had no power to condone the delay beyond 30 days, when in fact, the order examines the cause set out by the respondent and concludes that the same was unsubstantiated by the respondent. That finding has not been examined by the High Court in the impugned judgment and order at all, but the High Court was more impressed by the fact that the respondent was in a position to offer some explanation about the discrepancies in respect of the volume of turnover and that the respondent had already deposited 12.5% of the additional amount in terms of the previous order passed by it. That reason can have no bearing on the justification for non-filing of the appeal within the statutory period. No affidavit of the erring employee or at least the other employee 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. [Para 19][635-G-H; 636-A-E]
11. 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. [Para 19][636-E-F]
12. It is not correct to say 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. Rejection of delay application by the appellate forum does not entail in merger of the assessment order with that order. [Para 20][636-G-H; 637-A]
13. The High Court ought not to have entertained the subject writ petition filed by the respondent herein. The same deserved to be rejected at the threshold. [Para 21][637-A-B] Raja Mechanical Company Private Limited v.
Commissioner of Central Excise, Delhi-I (2012) 12 SCC
613 – relied on.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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