TaxTMI 
TaxTMI 
TaxTMI 
1967 (2) TMI 67
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....pellant is a public limited company which manufactures the well-known Tata Mercedes-Benz trucks, bus chassis, their spare parts and other accessories at Jamshedpur in the State of Bihar and they are sold to the Government of India, the State Governments, State Transport Corporations and others. In the course of its business the appellant-company sells its products, particularly the trucks and bus chassis, to dealers in various parts of India and the dealers resell them to consumers all over India. According to the appellant-company, its sales in the Indian market are of three kinds: (a) Sales inside Bihar State; (b) Sales in the course of inter-State trade and commerce; and (c) Sales effected from their stock-yards located in States othe....
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.... The appellant-company also inquired whether these sales were to be treated as sales in Bihar for the purposes of the Bihar Sales Tax Act or as sales in the course of inter- State trade and commerce for purposes of the Central Sales Tax Act but no reply was given. The appellant-company further asked for an opportunity to produce declarations from its customers, who are also registered dealers, with a view to claiming a rebate, but this opportunity was denied. The appellant-company objected to the assessment for a period of six months under a tax legislation, which it claimed, was intended to operate yearly but to no effect. According to the revised returns filed under compulsion, the break-up of the sales was as follows: The total gross tur....
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....ng the tax already paid, a demand for the sum of Rs. 1,73,84,273 was made. The order of assessment was passed on March 1, 1966, and the amount of arrears of tax was made payable on or before March 15, 1966. The appellant-company asked for time to make the payment and it was extended to March 21, 1966. The appellant-company filed a petition under Article 226 of the Constitution of India in the Patna High Court for directions or orders or writs, including a writ in the nature of certiorari calling for the records and quashing the order of the Assistant Commissioner. By the petition the jurisdiction of the Assistant Commissioner to make the assessment and the demand of tax in respect of stock-yard sales were questioned. Of the grounds urged, ....
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....x. As this came to Rs. 40,00,000 and odd only and Rs. 33,97,000 had already been paid, the High Court held that the company ought to appeal first since the payment of the balance (Rs. 6,00,000) was well within the capacity of the appellant-company and was not so onerous as to merit interference by way of extraordinary powers of the High Court. The application for certificate was accordingly dismissed. The appellant-company, however, obtained special leave from this Court and this appeal was filed. The learned Additional Solicitor-General, who appeared for the Assistant Commissioner, raised a preliminary objection that the appellant-company could not be heard as it had not exhausted the remedies available under the taxing statutes which gav....
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....le such remedies to be by-passed. To these there are certain exceptions. One such exception is where action is being taken under an invalid law or arbitrarily without the sanction of law. In such a case, the High Court may interfere to avoid hardship to a party which will be unavoidable if the quick and more efficacious remedy envisaged by Article 226 were not allowed to be invoked. In our judgment the present is an example of the exceptional situation above contemplated just as Himmatlal v. State of M.P. [1954] 5 S.T.C. 115; [1954] S.C.R. 1122., was another instance which came before this Court. The power and jurisdiction of the Assistant Commissioner, Jamshedpur, were exercisable in respect of sales to consumers in Bihar State and....