Natural justice bars assessment enhancement without notice; writ jurisdiction remained available despite an alternate remedy.

An appellate authority may enhance an assessment only after giving the assessee a reasonable opportunity to show cause, as required by the sales tax rules and the principles of natural justice. Because no such opportunity was granted before the enhancement, the order could not be sustained and was quashed. The existence of an alternative appellate remedy did not bar writ jurisdiction in these facts, since denial of fair hearing is a recognised exception to the rule of alternative remedy. The matter was remitted for fresh consideration after hearing the assessee, without any opinion on the merits.

---

---

Issues: (i) whether enhancement of assessment could be sustained without affording the assessee a reasonable opportunity to show cause against the proposed enhancement; (ii) whether availability of an appellate remedy barred exercise of writ jurisdiction in the facts of the case.

Issue (i): whether enhancement of assessment could be sustained without affording the assessee a reasonable opportunity to show cause against the proposed enhancement.

Analysis: Section 23(2) of the Orissa Sales Tax Act, 1947 empowers the appellate authority to enhance an assessment while disposing of an appeal, but Rule 50(3) of the Orissa Sales Tax Rules, 1947 mandates that no enhancement shall be made unless the appellant has had a reasonable opportunity of showing cause. The requirement also flows from the principles of natural justice, which demand fair hearing before an adverse order is made. The records showed that no such opportunity was granted before enhancement.

Conclusion: The enhancement order could not be sustained and was liable to be set aside.

Issue (ii): whether availability of an appellate remedy barred exercise of writ jurisdiction in the facts of the case.

Analysis: The existence of an alternative remedy is a rule of discretion and not an absolute bar. One recognized exception is violation of principles of natural justice. Since the assessee was denied the required opportunity before enhancement, the writ petition was entertainable notwithstanding the statutory appellate remedy.

Conclusion: The writ jurisdiction was properly invoked despite the availability of an alternative remedy.

Final Conclusion: The assessment enhancement was quashed and the matter was remitted for fresh consideration after giving the assessee an opportunity to respond, with no opinion expressed on the merits.

Ratio Decidendi: Where a taxing statute authorises enhancement in appeal, the appellate authority must first afford the affected assessee a reasonable opportunity of hearing, and breach of that mandatory requirement justifies writ intervention despite an alternate statutory remedy.

---