Writ maintainability and interim stay in aid of pending reference applications where surcharge recovery raised a prima facie statutory inconsistency.

A writ petition confined to seeking expeditious disposal of pending reference applications and interim protection against recovery was held maintainable notwithstanding the prior reference remedy, because the petition operated in aid of the statutory process. Recovery under the impugned notice was stayed pending disposal of the references, as Section 21(7) was directed to stay of recovery of tax, while the State's own stance on surcharge created a prima facie inconsistency on the character of the levy. The Court also found a prima facie case and balance of convenience in favour of interim protection, and requested the Tribunal to decide the references expeditiously.

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Issues: (i) whether the writ petition was maintainable despite the petitioner having already availed the reference remedy before the Tribunal; (ii) whether recovery pursuant to the impugned notice should be stayed pending disposal of the reference applications, in light of the statutory bar under Section 21(7) and the competing contention on the meaning of tax and surcharge.

Issue (i): whether the writ petition was maintainable despite the petitioner having already availed the reference remedy before the Tribunal.

Analysis: The petition was confined to two limited prayers: expeditious disposal of the pending reference applications and interim protection against recovery. Since the reference applications were already pending and the writ sought ancillary relief in aid of that process, the existence of the alternate reference remedy did not bar the petition.

Conclusion: The writ petition was maintainable and the objection based on alternate remedy was rejected.

Issue (ii): whether recovery pursuant to the impugned notice should be stayed pending disposal of the reference applications, in light of the statutory bar under Section 21(7) and the competing contention on the meaning of tax and surcharge.

Analysis: The statutory bar in Section 21(7) speaks to stay of recovery of tax. The State's own stand created an inconsistency because, if surcharge was treated as distinct from tax, the bar would not strictly govern surcharge recovery; if surcharge was treated as tax, the petitioner's challenge based on Rule 15(2)(b) became prima facie arguable. On the facts, the Court also found a prima facie case and balance of convenience in favour of the petitioner.

Conclusion: The recovery notice was stayed until the Tribunal decided the reference applications, and the Tribunal was requested to decide them expeditiously.

Final Conclusion: The petition succeeded to the limited extent of securing expeditious adjudication of the pending references and interim protection against coercive recovery, without any determination on the merits of the tax dispute.

Ratio Decidendi: A writ court may grant limited interim protection in aid of pending statutory proceedings where the petition is confined to securing expeditious disposal and preserving the subject matter, and a stay may be justified on a prima facie showing of inconsistency in the opposing statutory construction and balance of convenience.

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