2024 (12) TMI 219 - HC - VAT / Sales Tax

Court Dismisses Tax Dispute Shortcut, Imposes Rs. 1 Lakh Costs for Misleading Claims; Appeal Allowed with Conditions.

M/s. Venus Worldwide Entertainment Pvt. Ltd. Versus The State of Maharashtra and ors.

The court dismissed the Petitioner's attempt to bypass alternate remedies, emphasizing the necessity of exhausting available remedies under the ... Maintainability of petition - availability of alternative remedy - Attempt to make misleading statements and omitting to make statements that are required in such matters in the context of the availability of alternate remedies - Section 26 of the Maharashtra Value Added Tax Act, 2002 - HELD THAT:- Since the Petitioner is being relegated to avail of the alternate remedy, it is clarified that all contentions of the Petitioner and the Respondents on merits are kept open. At this stage, learned counsel for the Petitioner states that the appeal will be filed within four weeks after paying the costs. Suppose such an appeal is indeed filed within four weeks after complying with all the preconditions required under the law and paying the costs. In that case, the Appellate Authority should entertain the appeal on merits without adverting to the limitation issue. This is because the Petitioner instituted this Petition within the limitation period prescribed for instituting appeal. The Petition is disposed of. Issues:Petitioner's attempt to avoid alternate remedies, Jurisdiction of the Tribunal under Settlement Act, Exhaustion of alternate remedies, Imposition of costs on the Petitioner.Analysis:The judgment addresses the Petitioner's attempt to avoid alternate remedies despite the availability of an appeal under Section 26 of the Maharashtra Value Added Tax Act, 2002. The Petitioner argued that the dispute was already settled under the Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act, 2019. However, the court rejected this contention, emphasizing that the Tribunal can examine the rejection, and the Petitioner cannot avoid the alternate remedy provided under the said Act by misleadingly asserting the Tribunal's incapability to deal with objections related to the Settlement Act, 2019.The Petitioner contended that the actions of the third Respondent were without jurisdiction, but the court found this assertion to be a bald assertion without sufficient support. The court emphasized the importance of exhausting alternate remedies and noted that the Petitioner failed to provide reasons for abandoning this practice. The judgment referred to a previous case where the trend of bypassing alternate remedies was discussed, and based on that reasoning, the court declined to entertain the Petition due to the lack of a reasonable cause for deviating from the practice.In response to the rising trend of misleading averments and attempts to avoid alternate remedies, the court imposed costs of Rs. 1,00,000 on the Petitioner, with instructions to pay Rs. 50,000 to Tata Memorial Hospital and Rs. 50,000 to High Court Class IV Employees' Association. The judgment required the Petitioner to file a compliance report within four weeks. Despite being relegated to avail of the alternate remedy, the court clarified that all contentions of the Petitioner and Respondents on merits are kept open.The judgment concluded by stating that if the Petitioner files an appeal within four weeks after paying the costs, the Appellate Authority should entertain the appeal on merits without considering the limitation issue, as the Petition was filed within the prescribed limitation period for instituting an appeal. The Petition was disposed of with instructions for all concerned parties to act on an authenticated copy of the order.