Writ maintainability despite alternate remedy and remand of input tax credit revision for fresh factual verification.

A writ petition challenging a revisional order under the Telangana Value Added Tax Act was held maintainable despite the availability of a statutory appeal, because the court had already entertained the petition and granted interim relief, and the challenge concerned the exercise of revisional jurisdiction on an inadequate record. The revisional order withdrawing input tax credit was found unsustainable because revisional power under Section 32(2) can be exercised only where the assessment is prejudicial to revenue, and the material did not conclusively support the adverse inference drawn. As further factual verification was necessary, the matter was remanded for fresh decision after giving the assessee an opportunity to produce evidence.

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Issues: (i) whether the writ petition was maintainable despite availability of the statutory appeal under the VAT Act; (ii) whether the revisional order withdrawing input tax credit was sustainable and, if not, whether the matter required remand.

Issue (i): whether the writ petition was maintainable despite availability of the statutory appeal under the VAT Act.

Analysis: The statutory appeal under Section 33(1) of the Telangana Value Added Tax Act, 2005 was available against an order passed in revision under Section 32(2). However, the writ petition had already been entertained and admitted with interim relief. The availability of an alternate remedy did not, in the circumstances of the case, justify non-suiting the petitioner at the hearing stage, particularly where the challenge was directed against an exercise of revisional jurisdiction alleged to be without adequate material.

Conclusion: The writ petition was maintainable and the petitioner was not relegated to the appellate remedy.

Issue (ii): whether the revisional order withdrawing input tax credit was sustainable and, if not, whether the matter required remand.

Analysis: Revisional power under Section 32(2) of the Telangana Value Added Tax Act, 2005 can be exercised only where the assessment order is prejudicial to the interests of revenue. An order is not rendered prejudicial merely because the revisional authority prefers a different view. The record did not furnish adequate material to conclusively hold that the petitioner had shifted raw gold to a manufacturing unit at Kolkata and exported jewellery from there. The revisional authority proceeded beyond the vague statement relied upon and drew inferences unsupported by the record. Since additional factual verification was necessary, the matter required reconsideration after affording opportunity to the petitioner to produce evidence.

Conclusion: The revisional order and consequential effectual order were unsustainable and the matter was remanded for fresh decision in accordance with law.

Final Conclusion: The assessee obtained relief against the impugned revision, but only to the extent of having the orders set aside and the matter sent back for fresh adjudication after hearing.

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