Disputed tax liability on unresolved facts cannot be conclusively decided in writ proceedings; appeal remitted on merits.

Where tax liability depends on disputed facts that have not yet been examined by the statutory authorities, the writ court should not grant substantive relief merely because an earlier counter-affidavit lacked a detailed denial of each averment. The Court treated the later specific denial as relevant, held that the controversy required merits-based determination by the appellate authority, and directed remand for adjudication. In the special facts, the principle underlying Section 14 of the Limitation Act was applied to exclude delay in filing the statutory appeal, so the limitation objection was not to be raised and the appeal was to be decided in accordance with law.

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Issues: Whether the High Court was right in allowing the writ petition on the basis of the absence of fact-by-fact denial in the first counter-affidavit, and whether the matter should be remitted to the appellate authority with the appeal to be entertained without objection on limitation.

Analysis: The issue whether the transactions were assessable to tax was a question of fact requiring determination by the appropriate statutory authorities. The High Court did not examine the merits of the controversy and instead granted relief mainly because the first counter-affidavit did not contain a detailed denial of each averment, although a subsequent counter-affidavit did specifically deny the material facts. In these circumstances, the writ court ought not to have treated the matter as concluded. Since no authority had yet examined whether the transactions were exigible to tax, and the respondent had pursued statutory remedies after earlier proceedings, the appeal was liable to be entertained and decided on merits by the appellate authority. The principle underlying Section 14 of the Limitation Act was treated as applicable for excluding the delay in filing the statutory appeal in the facts of the case.

Conclusion: The High Court's order was unsustainable. The appellate authority was directed to hear the appeal on merits without raising limitation and to dispose of it in accordance with law.

Final Conclusion: The writ relief was set aside and the dispute was sent back to the sales tax appellate authority for adjudication on merits, with the limitation objection to be ignored in the special facts of the case.

Ratio Decidendi: Where the underlying tax liability turns on disputed facts not yet examined by the statutory authorities, a writ court should not grant substantive relief merely because an earlier counter-affidavit did not contain a detailed denial; in appropriate facts, delay in pursuing the statutory appeal may be overlooked and the matter remitted for decision on merits.

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