Alternate remedy and intra-State sale presumptions sustained writ refusal and transporter tax liability under KVAT rules.

A writ court's refusal to exercise Article 226 jurisdiction on the ground of an available but time-barred statutory remedy was not interfered with, because appellate review of such discretionary refusal is limited to cases of unreasonableness. On the tax issue, intercepted goods were detained for want of proper documents, released on payment of penalty, and there was no proof that they were taken outside Kerala or delivered to a registered consignee. In those circumstances, the person who secured release was treated as acting for the transporter, and the facts supported a presumption of intra-State sale. The transporter was therefore held liable to assessment and tax under the KVAT regime.

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Issues: (i) Whether refusal to exercise writ jurisdiction on the ground of alternate remedy called for interference in appeal; (ii) whether the transporter was liable to assessment and tax on the detained goods.

Issue (i): Whether refusal to exercise writ jurisdiction on the ground of alternate remedy called for interference in appeal.

Analysis: The writ court had declined relief under Article 226 on the basis that an appealable statutory remedy was available and the appellant had not pursued it within time. In appellate review of such discretionary refusal, interference is warranted only if the exercise of discretion is shown to be unreasonable.

Conclusion: No interference was called for with the refusal to exercise writ jurisdiction.

Issue (ii): Whether the transporter was liable to assessment and tax on the detained goods.

Analysis: Goods were intercepted without proper documents, detained, released on payment of penalty, and were not shown to have been taken back outside the State. No material was produced to establish the consignee or to show that the consignee was a registered dealer in Kerala. On the facts, the person who obtained release was treated as having acted for the transporter, and the circumstances supported a presumption that the goods were sold within Kerala. The transporter was therefore treated as liable to tax under the KVAT regime.

Conclusion: The transporter was held liable to assessment and tax.

Final Conclusion: The appellate court found no reason to disturb the writ court's refusal of relief and upheld the tax liability fastened on the transporter, resulting in dismissal of the appeal.

Ratio Decidendi: In appellate review of a writ court's discretionary refusal based on alternate remedy, interference is limited to unreasonableness, and where detained goods are released by the transporter without proof of a taxable consignee and are not taken out of the State, a presumption of intra-State sale may sustain assessment against the transporter.

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