2025 (9) TMI 597 - HC - GST

Additional Commissioner validly exercised suo motu revision under Section 23(4)(a); Commissioner appeal lies under Section 23(4)(c)(ii)

HC held the Additional Commissioner validly exercised suo motu revision under Section 23(4)(a) of the OST Act and, once so exercised, the Commissioner ... Entertainment of writ petition against the order passed in suo motu Revision - Lack of jurisdiction of Additional Commissioner invoking power u/s 23(4)(a) of the OST Act - requirement of satisfaction of twin conditions as envisaged under Rule 80 of the Odisha Sales Tax Rules, 1947 (OST Rules) for initiation of proceeding for revision under Section 23(4)(a) of the Odisha Sales Tax Act, 1947 - HELD THAT:- he Additional Commissioner is delegated with the power of revision to invoke Section 23(4)(a) of the OST Act which includes “on his own motion”. If the order in Revision is passed exercising power under Section 23(4)(a) by the authority subordinate to the Commissioner, an appeal lies to the Commissioner. The Additional Commissioner of Sales Tax (now called, Additional Commissioner of State Tax, on introduction of the Odisha Goods and Services Tax Act, 2017) is one of the authorities enumerated in Rule 3(1) of the OST Rules to assist the Commissioner, and such authority functions under administrative control of the Commissioner as per Rule 3(3). Thus, there is no ambiguity that the exercise of power under Section 23(4)(a) by the Additional Commissioner leaves no manner of scope for the Commissioner to exercise such power again. In Madhav Rao Jivaji Rao Scindia Vrs. Union of India [1970 (12) TMI 87 - SUPREME COURT], it has been observed that the non-obstante clause is no doubt a very potent clause intended to exclude every consideration arising from other provisions of the same statute or other statute but “for that reason alone we must determine the scope” of that provision strictly. When the section containing the said clause does not refer to any particular provisions which it intends to override but refers to the provisions of the statute generally, it is not permissible to hold that it excludes the whole Act and stands all alone by itself. A search has, therefore, to be made with a view to determining which provision answers the description and which does not. In view of the non-obstante clause contained in clause (d) of sub-section (4) of Section 23 of the OST Act, it is ex facie that no second or further revision lies before the Commissioner, if the Additional Commissioner once exercises his delegated power under Section 23(4)(a) of the OST Act - the power of revision has been delegated to the Assistant Commissioner by virtue of Notification No. 14171-CT, dated 03.08.1963, in the instant case, power under the same provision, i.e., Section 23(4)(a) of the OST Act has been delegated to Additional Commissioner vide Notification No. 12358-CT, dated 18.05.1963. However, both the authorities, namely the Assistant Commissioner and the Additional Commissioner, are enumerated under Section 3 read with Rule 3 to assist the Commissioner. Thus, apparently the Additional Commissioner having passed the order in the capacity of delegated authority to invoke power of revision, the Commissioner cannot invoke the same power again. Therefore, the appeal against the order passed in revision by the Additional Commissioner would lay before the Commissioner under Section 23(4)(c)(ii) of the OST Act. It is abundantly manifest that the Additional Commissioner having passed order in suo motu revision under Section 23(4)(a) read with Rule 80, the Commissioner could not re-initiate the proceeding invoking said provision. In view of clause (d) to sub-section (4) of Section 23, it is untrammelled position that the Commissioner is restrained from delegating the power of appeal envisaged under item (ii) of clause (c) of sub-section (4) of Section 23 to subordinate authorities enumerated under Rule 3 read with Section 3, but for certain condition. Therefore, necessary corollary would be that the Commissioner has the jurisdiction to be appellate authority against the order of revision passed by any other person appointed under Section 3(3) of the OST Act read with Rule 3 of the OST Rules. As the nuance of provisions contained in Section 23(4)(a) of the OST Act has already been judicially noticed by the Hon’ble Supreme Court of India as also this Court in the cases referred supra, at this juncture, therefore, observed that it is not a fit case for delving into such aspect again. Therefore, it is apposite to relegate the petitioner to avail alternative remedy as available under the OST Act, if it is so advised - In the event the petitioner prefers appeal against order dated 31st May, 2025 passed by the Additional Commissioner of State Tax under Section 23(4)(c) of the OST Act before the Commissioner, it is open for the petitioner to raise all the pleas that are available to it. The writ petition is disposed off. ISSUES PRESENTED AND CONSIDERED 1. Whether a writ under Articles 226/227 is maintainable to challenge an order of suo motu revision passed by an Additional Commissioner exercising delegated powers under Section 23(4)(a) of the OST Act and Rule 80 of the OST Rules. 2. Whether the Additional Commissioner validly possessed jurisdiction to invoke suo motu revision under Section 23(4)(a) read with Rule 80 (including satisfaction of the temporal and other 'twin' conditions in Rule 80), and if an alleged failure in satisfying those conditions is a jurisdictional defect permitting writ relief. 3. Whether the existence of an alternative statutory remedy of appeal under Section 23(4)(c) bars exercise of extraordinary writ jurisdiction in the facts of the case. 4. Whether, once a delegatee (Additional Commissioner/Assistant Commissioner) exercises revisional power under Section 23(4)(a), the delegator (Commissioner) can exercise the same revisional power again in relation to the same order. 5. Distinction between lack of jurisdiction (nullity) and irregular/excessive exercise of jurisdiction (curable illegality) in the context of fiscal assessment/revision proceedings and its impact on availability of writ relief. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Maintainability of writ against suo motu revision by delegatee Legal framework: Section 23(4)(a) confers revisional power on the Commissioner 'upon application or on his own motion'; clause (d) provides that Commissioner shall not delegate this power except with prior State Government approval; Rule 80 prescribes temporal limits and conditions for suo motu revision. Precedent treatment: The Court relies on authoritative decisions which treat the delegation and subsequent exercise of revisional power by subordinate authorities as creating a statutory route of appeal under Section 23(4)(c) to the Commissioner (when revision is by a subordinate) and which recognize that orders passed in exercise of delegated revisional power assume the character of orders of the Commissioner for practical purposes, with finality subject to the appeal mechanism. Interpretation and reasoning: The Court reads Section 23(4) and Rule 80 conjointly and holds that the Additional Commissioner was validly delegated revisional power; where such delegated power has been exercised, the aggrieved party's remedy is an appeal under Section 23(4)(c)(ii) to the Commissioner. Entertaining a writ in such circumstances would circumvent the statutory alternative remedy and render it otiose. The presence of an alternative, efficacious statutory remedy militates against exercise of extraordinary jurisdiction absent a clear jurisdictional defect. Ratio vs. Obiter: Ratio - where a subordinate authority validly exercises delegated revisional power under Section 23(4)(a), the appropriate remedy is the statutory appeal under Section 23(4)(c) and not ordinarily a writ; Obiter - observations on policy and administration of delegated powers. Conclusion: The writ is not an appropriate forum to challenge the suo motu revisional order in the absence of a demonstrated jurisdictional nullity; the petitioner should pursue the appeal under Section 23(4)(c)(ii). Issue 2 - Whether alleged non-satisfaction of Rule 80 conditions is a jurisdictional defect Legal framework: Rule 80 prescribes temporal limits (three years for Sales Tax Officer orders; two years for orders by Additional Commissioner, etc.) and requires satisfaction that the order is 'erroneous in so far as it is prejudicial to the interest of the revenue,' with opportunity to be heard. Precedent treatment: The Court reviews Supreme Court authority on jurisdictional facts and departmental decisions distinguishing jurisdictional facts from adjudicatory facts. Authorities indicate that absence of a jurisdictional fact (a preliminary condition without which the authority has no power) may justify writ relief, whereas errors on the merits or regularity of exercise are ordinarily for the statutory appellate forum. Interpretation and reasoning: The Court identifies the question whether the Rule 80 preconditions are jurisdictional as central but declines to determine merits on those factual/adjudicatory matters at writ stage. It notes that if the absence of a jurisdictional fact is established (i.e., the authority had no power to act at all), the order would be a nullity and amenable to writ. However, where the issue is whether Rule 80's conditions were satisfied on merits (time-limits, satisfaction that order is prejudicial to revenue, opportunity to be heard), such disputes are primarily for the appellate authority unless plain absence of jurisdiction is demonstrated at the inception. Ratio vs. Obiter: Ratio - absence of jurisdictional fact (patent want of jurisdiction) renders an order null and is contestable by writ; Obiter - detailed delineation of which aspects of Rule 80 are jurisdictional versus adjudicatory in contested cases. Conclusion: The Court refrains from adjudicating whether Rule 80's conditions were satisfied on merits; it holds that such matters should be raised and decided in the statutory appeal unless the petitioner can point to a clear absence of jurisdictional fact justifying immediate writ relief (which was not demonstrated). Issue 3 - Impact of alternative statutory remedy (Section 23(4)(c)) on writ jurisdiction Legal framework: Section 23(4)(c) grants a right of appeal from orders passed by the Commissioner on his own motion; where the order is passed by an authority subordinate to the Commissioner, an appeal lies to the Commissioner. Precedent treatment: The Court applies established principles that availability of an alternative, efficacious statutory remedy ordinarily bars exercise of extraordinary writ jurisdiction, unless exceptional circumstances or jurisdictional nullity exist. Interpretation and reasoning: The Court finds the statutory appeal to be both specific and adequate - the petitioner can raise all pleas (including alleged irregular assumption of jurisdiction and Rule 80 twin-conditions) before the Commissioner. Permitting writ would circumvent the legislative scheme and the availability of appeal that is expressly provided for in Section 23(4). Ratio vs. Obiter: Ratio - presence of a specific statutory appeal excludes relief by writ in absence of jurisdictional nullity; Obiter - commentary on futility argument when the revisional order is passed by a delegatee. Conclusion: The petitioner is relegated to the statutory appeal; the writ is dismissed on maintainability grounds without considering merits. Issue 4 - Whether the Commissioner can exercise revisional power again after delegatee acted Legal framework: Section 17 permits delegation; Section 23(4)(d) states that 'notwithstanding anything contained in Section 17' the Commissioner shall not delegate his powers under sub-section (4) except with prior State Government approval; Rule 2(e) defines 'Commissioner' to include officers to whom powers are delegated. Precedent treatment: Decisions cited establish that once revisional power is validly delegated and the delegatee exercises it, the delegator cannot re-exercise the same delegated revisional power in respect of the same order (doing so would amount to a second revision where first order already has the statutory finality subject to appeal). Delegation does not permanently denude delegator of power, but the scheme treats the delegatee's revisional act as exhausting the function for that order. Interpretation and reasoning: The Court reasons that where delegation was made with requisite prior approval and the Additional Commissioner (a designated authority under the Act/Rules) exercised the revisional power, the Commissioner cannot re-initiate a second revision over the same order; the aggrieved party's remedy lies in appeal to the Commissioner as provided by Section 23(4)(c)(ii). Ratio vs. Obiter: Ratio - exercise of delegated revisional power by the delegatee precludes a second revisional exercise by the delegator in relation to the same order; Obiter - discussion on delegation doctrine and legal character of delegatee's order. Conclusion: The Court affirms that no second revision by the Commissioner is permissible once the Additional Commissioner has validly exercised delegated revision; appeal lies to the Commissioner. Issue 5 - Distinction between want of jurisdiction and irregular assumption of jurisdiction Legal framework: Well-settled principle differentiates nullity (want of inherent jurisdiction) from mere irregularity or error in exercise of jurisdiction (curable via statutory remedies). Precedent treatment: The Court cites authorities explaining that orders passed without inherent jurisdiction are nullities and open to collateral attack; orders passed by a competent authority but in an irregular or erroneous manner are not nullities and must be challenged by the remedies provided by statute. Interpretation and reasoning: Applying these principles, the Court finds no material demonstrating that the Additional Commissioner lacked inherent jurisdiction to entertain the revisional power; therefore the order cannot be treated as a nullity for purposes of immediate writ relief. Disputes about propriety, regularity or satisfaction of statutory preconditions are predominantly appellate matters. Ratio vs. Obiter: Ratio - absent clear want of jurisdiction the appropriate course is statutory appeal; Obiter - observations on examples and authorities illustrating the distinction. Conclusion: The petitioner failed to demonstrate a jurisdictional nullity; the defect alleged relates to the exercise (and not the existence) of power and is remediable by appeal. OVERALL CONCLUSION The Court declines to exercise extraordinary writ jurisdiction to entertain the challenge to the suo motu revisional order passed by the Additional Commissioner. The petitioner is relegated to the statutory appeal under Section 23(4)(c)(ii) where all pleas including the satisfaction of Rule 80's conditions and other factual/contentions may be advanced; no determination on merits or on whether Rule 80's conditions were in fact satisfied is made. The writ petition is disposed on maintainability grounds without costs.