Tax clarification cannot override charging provision; writ jurisdiction remained available where statutory remedy was futile.

A clarification under Section 28-A of the Tamil Nadu General Sales Tax Act could not override Section 3D or alter the statutory rate of tax. For the period before 1-4-2002, when Section 3D imposed a flat 2% tax on food and drinks sold in hotels and restaurants and did not distinguish branded from unbranded goods, the clarification treating branded pizza as taxable at 16% was invalid. The writ petitions were also maintainable despite alternative statutory remedies because subordinate authorities were bound by the clarification, making departmental challenge futile. The impugned clarification and consequential assessment for the pre-1-4-2002 period were therefore set aside.

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Issues: (i) Whether the clarification issued by the Commissioner under Section 28-A of the Tamil Nadu General Sales Tax Act, 1959 could validly treat branded pizza as taxable at 16% for the period prior to 1-4-2002 notwithstanding Section 3D of the Act. (ii) Whether the writ petitions were maintainable despite the availability of an alternative statutory remedy before the assessing and appellate authorities.

Issue (i): Whether the clarification issued by the Commissioner under Section 28-A of the Tamil Nadu General Sales Tax Act, 1959 could validly treat branded pizza as taxable at 16% for the period prior to 1-4-2002 notwithstanding Section 3D of the Act.

Analysis: Section 3D, as it stood prior to 1-4-2002, imposed a flat rate of tax of 2% on food and drinks sold in hotels and restaurants having the prescribed turnover, and it did not draw any distinction between branded and unbranded goods. The amended form of the provision introduced the concept of unbranded food and drinks only from 1-4-2002. A clarification issued under Section 28-A could not override the charging section or alter the rate of tax fixed by the statute and the Schedules. A direction treating branded pizza as taxable at 16% for the earlier period would amount to amending the statute through a clarification, which was impermissible.

Conclusion: The clarification was invalid to the extent it levied tax at 16% on branded pizza for the period prior to 1-4-2002, and the assessee succeeded on this issue.

Issue (ii): Whether the writ petitions were maintainable despite the availability of an alternative statutory remedy before the assessing and appellate authorities.

Analysis: A clarification issued by a superior authority binds subordinate officers in administrative implementation, and a challenge before those very authorities would be futile where they are bound to follow it. The available appellate or revisional remedy was therefore not an efficacious alternative for testing the legality of the clarification. In such circumstances, recourse under Article 226 was maintainable to challenge the clarification directly.

Conclusion: The objection based on alternative remedy was rejected, and the writ petitions were maintainable in favour of the assessee.

Final Conclusion: The impugned clarification and consequential assessment, insofar as they applied a 16% tax rate for the pre-1-4-2002 period, were set aside, and the assessee obtained relief against the Tribunal's contrary view and the assessment founded on the clarification.

Ratio Decidendi: A clarification issued by a tax authority cannot override the charging provisions of the statute, and where subordinate authorities are bound by the clarification, the existence of a formal statutory appeal does not bar writ jurisdiction if that remedy would be futile.

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