Writ jurisdiction cannot replace tax appeal findings on merits; statutory appeals restored subject to deposit and security conditions.

Article 226 review cannot replace the statutory appellate process by reappreciating primary facts or deciding taxability on merits, except where the fact-finding process is perverse or unlawful; the High Court therefore exceeded writ jurisdiction in treating restaurant food supply as a mere service and not a sale exigible to tax. The refusal to waive pre-deposit under the Haryana General Sales Tax Act was a separate procedural issue, and the earlier denial was interfered with only to restore the statutory appeals subject to deposit and security conditions.

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Issues: (i) Whether the High Court, in writ jurisdiction, could reappreciate the assessment record and decide on merits that supply of food in the respondents' restaurants was a mere service and not a sale exigible to tax. (ii) Whether the refusal to waive the pre-deposit requirement under the proviso to section 39(5) of the Haryana General Sales Tax Act, 1973 required interference and restoration of the statutory appeals.

Issue (i): Whether the High Court, in writ jurisdiction, could reappreciate the assessment record and decide on merits that supply of food in the respondents' restaurants was a mere service and not a sale exigible to tax.

Analysis: The statutory scheme provided an appellate remedy against the assessment, and the controversy as to whether the transactions were sales or services depended upon primary facts and inferential evaluation entrusted to the fact-finding authority. Judicial review under article 226 was confined to examining the legality of the decision-making process and could not be converted into a full appellate reappraisal of facts or the correctness of the assessment on merits, except where the finding was perverse or based on irrelevant material. The High Court therefore exceeded the limits of writ jurisdiction in re-examining the merits of the assessment and substituting its own view on the nature of the transactions.

Conclusion: The High Court was not entitled to decide the taxability issue on a reappraisal of facts, and its interference on the merits was unsustainable, in favour of Revenue.

Issue (ii): Whether the refusal to waive the pre-deposit requirement under the proviso to section 39(5) of the Haryana General Sales Tax Act, 1973 required interference and restoration of the statutory appeals.

Analysis: The respondents' grievance against the pre-deposit condition remained a separate question from the merits of the assessment. In view of the lapse of time, the matter was not remitted for fresh consideration, and the respondents were to be afforded a practical opportunity to pursue the statutory appeal. The earlier refusal to grant the benefit of the proviso was set aside and the appeals were restored, subject to deposit of a specified sum and furnishing security for the balance.

Conclusion: The refusal under the proviso to section 39(5) was interfered with, and the respondents were allowed to pursue their appeals subject to conditions, in favour of the respondents on this limited procedural relief.

Final Conclusion: The writ-based interference with the assessment on merits was set aside, while the respondents' statutory appeals were restored for disposal on merits after compliance with the directed deposit and security conditions.

Ratio Decidendi: Judicial review under article 226 cannot be used as a substitute for the statutory appellate process to reappreciate primary facts or determine tax liability on merits, except where the fact-finding process is vitiated by perversity or illegality.

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