TaxTMI 
TaxTMI 
2017 (3) TMI 1939
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....f 2003") apart from assessment order passed thereupon in few cases. 2. The petitioners are mobile and laptop companies or traders therein, who were assessed in majority of cases under Section 23 of the Act of 2003. The respondents, thereupon, issued notices under Sections 25, 55 and 61 of the Act of 2003 in some cases and, in remaining cases, notice under Sections 26, 55 and 61 of the Act of 2003. The petitioners contested the notices before the Assessing Authority in few cases and others filed writ petitions to challenge the notice but, in absence of interim order, assessment order was passed and has been challenged by amending the writ petition/s. The challenge to the notice under Sections 25 and 26 read with Sections 55 and 61 of the Act of 2003 and order of assessment has been made on various grounds. 3. Learned counsel for the petitioners submitted that the notices under Sections 25 or 26 read with Sections 55 and 61 of the Act of 2003 were given precisely in reference to the judgment of the Apex Court in the case of State of Punjab & Ors. v. Nokia India Private Limited reported in 2014 (6) SCC 410, wherein, it was held that a battery charger is taxed separately. It is for t....
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....r or with change of opinion. 7. Learned counsel for the petitioners have given reference of judgment of the Apex Court in the case of CIT v. Kelvinator of India reported in 2010 (2) SCC 723. The judgment aforesaid was in reference to Section 147 of the Income Tax Act, 1961 (for short "the Act of 1961"). Therein, the concept of "change of opinion" has been discussed and given interpretation. 8. Similar view was taken in the case of STO v. Uttareswari Rice Mills reported in 1973(3) SCC 171. Therein, it was held that "for any reason" is the same as "reason to believe". The reassessment cannot be made by "changing of opinion". The "reason to believe" should be when tax has been avoided or evaded and not otherwise. The provisions of Sections 25 and 26 of the Act of 2003 are similar to Section 147 of the Act of 1961. 9. Learned counsel for the petitioners have made specific reference of Section 25 of the Act of 2003 to show that notice under the said provision can be given only when tax is avoided or evaded. The cases in hand are not falling in the aforesaid category as the petitioners made complete disclosure of composite pack followed by assessment in the hands of the respondents. T....
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.... thus it cannot be applied to other cases where contest has been made. The issues, which were not taken before the Apex Court, can be raised herein in view of the judgment of the Apex Court in the case of BSNL v. Union of India reported in 2006(3) SCC 1. It is moreso when, doctrine of res judicata and constructive res judicata does not apply to tax laws as each assessment year is to be taken separately thus for the aforesaid reason also, impugned notices under Sections 25 and 26 of the Act of 2003 and subsequent assessment orders are not legally sustainable. 13. The petitioners have even challenged the order of assessment on the ground that battery charger and battery are not sold separately when it is in composite pack thus it cannot be subjected to separate assessment of tax treating it to be an accessory. The valuation of charger has also been challenged in bunch of writ petitions apart from unilateral demand based on judgment of the Apex Court in the case of Nokia India Private Limited (supra). The interest and penalty levelled has also been challenged. They have raised many other issues in reference to the orders of assessment. 14. Learned counsel for the petitioners have gi....
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....ecided eliminating imposition of penalty while maintaining demand of tax and interest thus if any interference in the notice or assessment order is made by this Court, it will create two sets of assessees despite being similarly placed. A prayer is accordingly made to dismiss all the writ petitions. 17. Learned counsel has further submitted that Section 25 of the Act of 2003 can be invoked not only in the case of evasion and avoidance but when tax has not been paid in accordance with law. In the instant case, tax has not been paid by the petitioners in accordance with provisions of law. The tax on the accessories is to be paid separately thus notice has been given. It is, no doubt, true that notice aforesaid has been given after judgment of the Apex Court in the case of Nokia India Private Limited (supra). 18. Prior to the judgment of the Apex Court in the case of Nokia India Private Limited (supra), there was no judgment of the jurisdictional High Court thus it is not a case of reversal finding by the Apex Court after a judgment of the jurisdictional High Court. Learned counsel for the petitioners have relied on judgments of the Apex Court where it has been held that subsequent ....
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....ment of the Apex Court in the case of Nokia India Private Limited (supra). It is, however, a fact that judgment of the Apex Court in the case of Nokia India Private Limited (supra) was not given after a judgment of the jurisdictional High Court. The charger, battery or any other accessories of cell phone or laptop was not subject matter before the Rajasthan High Court prior to the judgment in the case of Nokia India Private Limited (supra) thus it is not a case where assessment order under Section 23 of the Act of 2003 or reassessment was made based on the judgment of the jurisdictional High Court, hence, reversal of judgment thereupon by the Apex Court cannot be used for issuance of notice. 23. Learned counsel for petitioners have contested the issue of alternative remedy. The challenge to the assessment is not only in reference to Sections 25 and 26 of the Act of 2003 but even in regard to valuation of accessories and for imposition of interest and penalty apart from many other grounds. The writ petitions are not restricted to the issue of notice under Sections 25 or 26 of the Act of 2003 but are on other issues also which require finding of fact. In view of aforesaid, objection....
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....r impugned orders was not made. It was mainly on the ground of existence of efficacious alternative remedy. No doubt, it is true that availability of alternative remedy is not a bar for exercise of jurisdiction under Article 226 of the Constitution of India but, in this case, notices under challenge have proceeded with assessment orders and all the issues have been dealt with thus it would be proper to avail remedy of appeal. It is moreso when, even questions of fact are involved as valuation of charger and other accessories has also been challenged which need finding of fact. 27. It would be gainful to refer relevant paras of the judgment of Himachal Pradesh High Court in the case of Samsung India Electronics Pvt. Ltd. v. State of Himachal Pradesh & Ors. (supra) : "6. It is not in dispute that respondents No. 3 and 4 are authorities constituted under the H.P. VAT Act, 2005, and therefore, even if it is assumed that there is an illegal or irregular exercise of jurisdiction the same would not result in the order being without jurisdiction. Even if there has been some defect in the procedure followed during the hearing of the case, it does not follow that the authority has acted w....
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.... as it stood right from the beginning as per its decision. In Gian Devi Anand's case (supra) the interpretation given by the Delhi High Court that commercial tenancies were not heritable was overruled being erroneous. Interpretation given by the Delhi High Court was not legal. The interpretation given by this Court declaring that the commercial tenancies heritable would be the law as it stood from the beginning as per the interpretation put by this Court. It would be deemed that the law was never otherwise." 10. Similarly in Assistant Commissioner, Income Tax, Rajkot v. Saurashtra Kutch Stock Exchange Limited : (2008) 14 SCC 171, the Hon'ble Supreme Court has held as follows:-- "35. In our judgment, it is also well-settled that a judicial decision acts retrospectively. According to Blackstonian theory, it is not the function of the Court to pronounce a 'new rule' but to maintain and expound the 'old one'. In other words, Judges do not make law, they only discover or find the correct law. The law has always been the same. If a subsequent decision alters the earlier one, it (the later decision) does not make new law. It only discovers the correct principle....
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....eal, are further appealable to the Tribunal. Section 48 of the HP VAT Act, 2005 further provides that the order of the Tribunal can be assailed by way of revision before the High Court. 8. We deem it proper to reproduce Sections 45, 46 and 48 of the HP VAT Act, 2005 here under: "45. Appeal. - (1) An appeal from every original order passed under this Act or rules made thereunder shall lie- (a) if the order is made by an Assessing Authority or by an officer-in-charge of the check post or barrier or any other officer not below the rank of the Excise and Taxation Officer, to the Deputy Excise and Taxation Commissioner; (b) if the order is made by the Deputy Excise and Taxation Commissioner, to the Commissioner or the Additional Excise and Taxation Commissioner, posted at the State Headquarters; (c) if the order is made by the Commissioner or the Additional Excise and Taxation Commissioner posted at the State Headquarters any officer exercising the powers of the Commissioner, to the Tribunal. (2) An order passed in appeal by a Deputy Excise and Taxation Commissioner or by the Additional Excise and Taxation Commissioner posted at the State Headquarters or by the Commissioner ....
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.... respect of such areas as may be specified in the notification and such officer shall be deemed to be the Commissioner for the purposes of sub-section (1). (3) The tribunal, on application made to it against an order of the Commissioner under this section within sixty days from the date of the communication of the order, for the purpose of satisfying itself as to the legality or propriety of such order, may call for and examine the record of any such case and may pass such orders thereon as it thinks just and proper. (4) No order shall be passed under this section, which adversely affects any person unless such person has been given a reasonable opportunity of being heard. xxxxxxxxxxxxxxxxxxxxxxxxxxxxx 48. Revision to High Court. - (1) Any person aggrieved by an order made by the tribunal under subsection (2) of section 45 or under sub-section (3) of section 46, may, within 90 days of the communication of such order, apply to the High Court of Himachal Pradesh for revision of such order if it involves any question of law arising out of erroneous decision of law or failure to decide a question of law. (2) The application for revision under sub-section (1) shall precisely s....
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....for determination is - when an Act provides mechanism to have remedy(ies), can a writ lie in the given circumstances? The answer is in the negative for the following reasons. It is well settled principle of law that High Courts have imposed rule of self limitation in entertaining the writ petition in terms of writ jurisdiction when alternative remedy is available. High Court must not interfere if there is adequate efficacious alternative remedy available and the practice of approaching the High Court, without availing the remedy(ies) provided, must be deprecated, unless express case is made out." 12. The Apex Court in Union of India and another v. Guwahati Carbon Limited, : (2012) 11 SCC 651, while dealing with the similar question, has observed in paragraphs 8, 9, 10, 11, 14 and 15 as under: "8. Before we discuss the correctness of the impugned order, we intend to remind ourselves the observations made by this Court in Munshi Ram v. Municipal Committee, Chheharta, : AIR 1979 SC 1250. In the said decision, this Court was pleased to observe that: (SCC p.88, para 23) "23........ when a revenue statute provides for a person aggrieved by an assessment thereunder, a particular rem....
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....ter by way of an appeal before this Court under Section 35L of the Central Excise Act, 1944. 15. In our opinion, the assessee ought not to have filed a writ petition before the High Court questioning the correctness or otherwise of the orders passed by the Tribunal. The Excise Law is a complete code in order to seek redress in excise matters and hence may not be appropriate for the writ court to entertain a petition under Article 226 of the Constitution. Therefore, the learned Single Judge was justified in observing that since the assessee has a remedy in the form of a right of appeal under the statute, that remedy must be exhausted first. The order passed by the learned Single Judge, in our opinion, ought not to have been interfered with by the Division Bench of the High Court in the appeal filed by the respondent/assessee." 13. The Apex Court in Nivedita Sharma v. Cellular Operators Association of India and others, (2011) 14 SCC 337, after discussing its various earlier decisions, held that the High Court had committed error in entertaining the writ petition without noticing and referring to the relevant provisions of law applicable in that case, which contained statutory rem....
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....rajan, : (1988) 1 SCC 572; Rajasthan SRTC v. Krishna Kant, (1995) 5 SCC 75; Kerala SEB v. Kurien E. Kalathil, : (2000) 6 SCC 293; A. Venkatasubbiah Naidu v. S. Chellappan, (2000) 7 SCC 695; L.L. Sudhakar Reddy v. State of A.P., (2001) 6 SCC 634; Shri Sant Sadguru Janardan Swami (Moingiri Maharaj); Sahakari Dugdha Utpadak Sanstha v. State of Maharashtra, (2001) 8 SCC 509; Pratap Singh v. State of Haryana, : (2002) 7 SCC 484 and GKN Driveshafts (India) Ltd. v. ITO, (2003) 1 SCC 72). 13. In Nivedita Sharma v. Cellular Operators Assn. of India,: (2011) 14 SCC 337, this Court has held that where hierarchy of appeals is provided by the statute, the party must exhaust the statutory remedies before resorting to writ jurisdiction for relief and observed as follows: (SCC pp. 34345 paras 12-14) "12. In Thansingh Nathmal v. Supdt. of Taxes, AIR 1964 SC 1419 this Court adverted to the rule of self-imposed restraint that the writ petition will not be entertained if an effective remedy is available to the aggrieved person and observed: (AIR p. 1423, para 7). '7.... The High Court does not therefore act as a court of appeal against the decision of a court or tribunal, to correct errors o....
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....vious that the provisions of the Act cannot bar and curtail these remedies. It is, however, equally obvious that while exercising the power under Article 226/Article 32, the Court would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment.'" (See: G. Veerappa Pillai v. Raman & Raman Ltd, AIR 1952 SC 192; CCE v. Dunlop India Ltd.,: (1985) 1 SCC 260; Ramendra Kishore Biswas v. State of Tripura, (1999) 1 SCC 472; Shivgonda Anna Patil v. State of Maharashtra, (1999) 3 SCC 5; C.A. Abraham v. ITO, (1961) 2 SCR 765; Titaghur Paper Mills Co. Ltd. v. State of Orissa, (1983) 2 SCC 433; H.B. Gandhi v. Gopi Nath and Sons, 1992 Supp (2) SCC 312; Whirlpool Corpn. v. Registrar of Trade Marks, (1998) 8 SCC 1; Tin Plate Co. of India Ltd. v. State of Bihar, (1998) 8 SCC 272; Sheela Devi v. Jaspal Singh, (1999) 1 SCC 209 and Punjab National Bank v. O.C. Krishnan, (2001) 6 SCC 569) 14. In Union of India v. Guwahati Carbon Ltd., (2012) 11 SCC 651, this Court has reiterated the aforesaid principle and observed: (SCC p.653, para 8) "8. Before we discuss the correctness of the imp....
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.... an exercise in futility. 17. In the instant case, neither has the writ petitioner assessee described the available alternate remedy under the Act as ineffectual and non-efficacious while invoking the writ jurisdiction of the High Court nor has the High Court ascribed cogent and satisfactory reasons to have exercised its jurisdiction in the facts of instant case. In light of the same, we are of the considered opinion that the Writ Court ought not to have entertained the Writ Petition filed by the assessee, wherein he has only questioned the correctness or otherwise of the notices issued under Section 148 of the Act, the re-assessment orders passed and the consequential demand notices issued thereon." 15. The decisions referred to by the learned counsel for the petitioners have been discussed by the Apex Court in the decisions of Union of India and another v. Guwahati Carbon Limited, Nivedita Sharma v. Cellular Operators Association of India and others and Commissioner of Income Tax and others v. Chhabil Dass Agarwal, referred to hereinabove. 16. The sum and substance of the above discussion is that the writ petitioners-Company have remedies of appeal(s), before approaching th....
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....and another 2015 AIR SCW 2497, wherein the Hon'ble Supreme Court was confronted with the similar proposition regarding maintainability of writ petition when alternative remedy was available to the aggrieved party under the Armed Forces Tribunal Act and the Hon'ble Supreme Court after making a reference to the judgments as cited in M/s. Indian Technomac Company Ltd. case (supra) and in addition thereto after taking into consideration the judgment rendered by it in Kanaiyalal Lalchand and Sachdev and others v. State of Maharashtra and others (2011) 2 SCC 782, Executive Engineer, Southern Electricity Supply Company of Orissa Limited (SOUTHCO) and another v. Sri Seetaram Rice Mill : (2012) 2 SCC 108, Cicily Kallarackal v. Vehicle Factory 2012 (8) SCC 524 and Union of India v. Brigadier P.S. Gill : (2012) 4 SCC 463 culled out the following principles: "34.....(i) The power of judicial review vested in the High Court under Article 226 is one of the basic essential features of the Constitution and any legislation including Armed Forces Act, 2007 cannot override or curtail jurisdiction of the High Court under Article 226 of the Constitution of India.(Refer: L. Chandra AIR 1997 SC....
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....aimed at to give a slip to law for the reason that the petitioner has to deposit the tax liability alongwith interest payable as assessed and penalty, if any imposed in terms of section 45(5) of the H.P. VAT Act, 2005, which clearly provides that no appeal would be entertained unless it is accompanied by a statutory proof of the payment of tax including interest payable alongwith penalty, if any subject to the exception provided by proviso to sub-section (5) of section 45 of H.P. VAT Act, 2005. 17. Having said so, we are of the considered view that the writ petitioner has not only an alternative and efficacious, rather a proper remedy under the provisions of H.P. VAT Act, 2005 and therefore, the present petition is not maintainable. Accordingly, the same is dismissed in limine. However, it is made clear that the observations made hereinabove shall not cause any prejudice to the petitioner in case it intends to file an appeal(s) before the prescribed authority and the period spent by the petitioner for prosecuting this petition shall be excluded by the appellate authority while computing the period of limitation. 18. In view of the aforesaid discussion, the writ petition is dism....