Writ jurisdiction can survive an alternate tax appeal; penalty and interest need strict statutory preconditions.

An available appellate remedy does not automatically bar writ jurisdiction where it is ineffective or inadequate, particularly on jurisdictional questions. The text further states that penalty under section 11(1) of the Bengal Finance (Sales Tax) Act, 1941 requires default without reasonable cause, so a technical or bona fide lapse is insufficient and the penalty was unsustainable on the stated facts. It also explains that interest under section 10A can be charged only when the statutory conditions are strictly met; returns filed under interim court protection and the absence of a valid revised return did not justify the interest demand.

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Issues: (i) Whether the writ application was maintainable despite the availability of statutory appeals, (ii) whether penalty under section 11(1) of the Bengal Finance (Sales Tax) Act, 1941 was lawfully imposed, and (iii) whether interest under section 10A of the Bengal Finance (Sales Tax) Act, 1941 could be charged on the facts of the case.

Issue (i): Whether the writ application was maintainable despite the availability of statutory appeals.

Analysis: The existence of an appellate remedy does not, by itself, bar exercise of writ jurisdiction where the alternative remedy is not effective or adequate and the dispute turns on jurisdictional issues rather than disputed facts. The returns and assessments in question involved recurring questions on the legality of levy, and the applicant also undertook not to pursue the pending appeals. In these circumstances, the availability of appeal was treated as no ground to reject the writ at the threshold.

Conclusion: The writ application was maintainable.

Issue (ii): Whether penalty under section 11(1) of the Bengal Finance (Sales Tax) Act, 1941 was lawfully imposed.

Analysis: Penalty under section 11(1) requires default without reasonable cause and is not justified for a mere technical or bona fide lapse. At the relevant time, the dealer had filed returns in accordance with an interim court order permitting exemption claims, and the notification that formed the basis of the demand had already been quashed by the trial court. The default, if any, was not deliberate, contumacious, or in conscious disregard of statutory obligation.

Conclusion: The penalty was not sustainable and had to be set aside.

Issue (iii): Whether interest under section 10A of the Bengal Finance (Sales Tax) Act, 1941 could be charged on the facts of the case.

Analysis: Interest under section 10A depends on the statutory conditions in its relevant sub-sections, including failure to pay tax according to a return or failure to furnish a return. The dealer had filed returns showing the turnover and claimed exemption pursuant to the court's interim protection, and the statement obtained during assessment could not lawfully be treated as a revised return under section 10(4). On those facts, neither non-filing of return nor failure to pay admitted tax in the statutory sense was established, and it would be unjust to fasten interest for amounts the dealer had been authorised by court order not to pay pending disposal.

Conclusion: The interest demand was not sustainable and had to be set aside.

Final Conclusion: The proceedings succeeded only in part, with relief granted on the penalty and interest demands under the Bengal Finance (Sales Tax) Act, 1941, while no determination was made on the corresponding issues under the Central Sales Tax Act, 1956.

Ratio Decidendi: A writ court may entertain a tax dispute despite an available appeal where the alternative remedy is ineffective in the circumstances, and penalty or interest cannot be imposed unless the statutory preconditions for those liabilities are strictly satisfied on the facts as they stood when the returns were filed.

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