TaxTMI 
TaxTMI 
2022 (9) TMI 1595
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....earned counsel for the petitioners whereas, the respondents are represented by Shri SC Keyal, the learned Standing Counsel, Customs Department, who also questions the maintainability of the writ petition itself and therefore, the said objection has to be decided first. 3. Before going to the issue which has arisen for adjudication, it would be convenient to state the facts of the case in brief. 4. The petitioner no. 1 is the proprietor of M/s. SR Enterprise whereas the petitioner no. 2 is the Power of Attorney holder. The petitioners deal with the business of areca nuts for which license has been issued under Sections 25/57/95 of the Assam Panchayat Act, 1994. The petitioners also claim to have procured GST registration certificate. 5. It is the case of the petitioners that dried areca nuts were purchased from different purchasers. In May, 2020-6489 Kgs., in June, 2020-32560 kgs and in July, 2020, there was both purchase and sale and the remaining stock was 48336 kgs. Similarly, after the transaction in the month of August, 2020, the petitioners had total stock of dried areca nuts of 50757 kgs. out of which a quantity of 40300 kgs. were sold. The petitioners have projected....
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....under Sections 111(b)/111(d)/ 111(e) of the Act. It is contended that neither Section 112 of the Act is applicable in the facts of the case nor Section 14. It is, accordingly contended that the aforesaid show cause notice is liable to be set aside and quashed. The learned counsel for the petitioner further submits that the application of the petitioners for provisional release of the goods has not been adjudicated upon and in this regard, a reminder dated 09.09.2020 was also made. 9. In support of his submissions, Shri Garodia, the learned counsel for the petitioner places reliance upon a number of decisions. However, this Court deems if fit to consider only the decisions of the Hon'ble Supreme Court and the relevant decisions of different High Courts. The following are the said decisions: (i) Calcutta Discount Company Ltd. vs. Income Tax Officer, (1961) 2 SCR 241, (ii) A.V. Venkateswaran vs. Ramchand Sobhraj Wadhwani, (1962) 1 SCR 753 : AIR 1961 SC 1506, (iii) M/s. Baburam Prakash vs. Antarim Zila Parishad, (1969) 1 SCR 518, (iv) Whirlpool Corporation Vs. Registrar of Trade Marks, (1998) 8 SCC 1, (v) State of AP vs. M/s. Linde India ....
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.... had reason to believe that "there had been some omission or failure to disclose fully and truly all material facts necessary for the assessment" for any of these years in consequence of which the under-assessment took place." 11. In the cases of A.V. Venkateswaran (supra) and M/s. Baburam Prakash (supra), the Hon'ble Supreme Court was considering the aspect of availability of alternative remedy. In the former case, the following observations were made: "9. We see considerable force in the argument of the learned Solicitor-General. We must, however, point out that the Rule that the party who applies for the issue of a high prerogative writ should, before he approaches the Court, have exhausted other remedies open to him under the law, is not one which bars the jurisdiction of the High Court to entertain the petition or to deal with it, but is rather a Rule which Courts have laid down for the exercise of their discretion. The law on this matter has been enunciated in several decisions of this Court ......... 10. The passages in the judgments of this Court we have extracted would indicate (1) that the two exceptions which the learned Solicitor-General fo....
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....rinciples laid down by all these decisions are: (1) Although a circular is not binding on a Court or an assessee, it is not open to the Revenue to raise the contention that is contrary to a binding circular by the Board. When a circular remains in operation, the Revenue is bound by it and cannot be allowed to plead that it is not valid nor that it is contrary to the terms of the statute. (2) Despite the decision of this Court, the Department cannot be permitted to take a stand contrary to the instructions issued by the Board. (3) A show cause notice and demand contrary to existing circulars of the Board are ab initio bad. (4) It is not open to the Revenue to advance an argument or file an appeal contrary to the circulars." 16. Per contra, Shri Keyal, the learned Standing Counsel, Customs Department, apart from opposing the writ petition has raised a preliminary objection on the maintainability of the writ petition. By referring to the affidavit-in-opposition filed by the respondents on 10.08.2021, the learned Standing Counsel has contended that the writ petition itself is a pre-matured one wherein a show cause notice dated 20.02.2021 has been ....
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.... which, is not liable to be interfered with. 20. In support of his submission, Shri Keyal, the learned Standing Counsel, Customs Department has placed reliance upon the following case laws: (i) Assistant Collector of Central Excise Vs. Dunlop India Ltd., (1985) 1 SCC 260; (ii) State of Gujarat Vs. Mohanlal Jitamalji Porwal & Anr., (1987) 2 SCC 364; (iii) Indru Ramchand Bharvani & Ors. Vs. Union of India & Ors., (1988) 4 SCC 1; (iv) United Bank of India Vs. Satyawati Tondon & Ors., (2010) 8 SCC 110; (v) Phoenix ARC Private Ltd. Vs. Vishwa Bharati Vidya Mandir & Ors., (2022) 5 SCC 345; (vi) State of Andhra Pradesh Vs. S. Pitchi Reddy, (2022) 2 SCC 569. 21. In the case of Dunlop India Ltd. (supra), the Hon'ble Supreme Court has held as follow: "3. In Titaghur Paper Mills Co. Ltd. v. State of Orissa A.P. Sen, E.S. Venkataramiah and R.B. Misra, JJ. held that where the statute itself provided the petitioners with an efficacious alternative remedy by way of an appeal to the Prescribed Authority, a second appeal to the tribunal and thereafter to have the case stated to the High Court, it was not for the High Court to exer....
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....he facts, found that cumulative effect or preponderance of evidence cannot be interfered with where the fact-finding body or authority has acted reasonably upon the view which can be taken by any reasonable man, courts will be reluctant to interfere in such a situation." 23. In the cases of Satyawati Tondon & Ors. (supra) as well as Phoneix (supra), the Hon'ble Supreme Court has discussed the aspect of maintainability of a writ petition. For ready reference, the relevant discussion made in the case of Phoenix (supra) is extracted herein below:- "In Satyawati Tondon, it was observed and held by this Court that the remedies available to an aggrieved person against the action taken under Section 13(4) or Section 14 of the SARFAESI Act, by way of appeal under Section 17, can be said to be both expeditious and effective. On maintainability of or entertainability of a writ petition under Article 226 of the Constitution of India, in a case where the effective remedy is available to the aggrieved person, it is observed and held in the said decision in paras 43 to 46 as under : "43. Unfortunately, the High Court overlooked the settled law that the High Court will ordina....
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.... discharging their constitutional and legal obligations towards the citizens. In cases relating to recovery of the dues of banks, financial institutions and secured creditors, stay granted by the High Court would have serious adverse impact on the financial health of such bodies/institutions, which (sic will) ultimately prove detrimental to the economy of the nation. Therefore, the High Court should be extremely careful and circumspect in exercising its discretion to grant stay in such matters. Of course, if the petitioner is able to show that its case falls within any of the exceptions carved out in Baburam Prakash Chandra Maheshwari v. Antarim Zila Parishad, Whirlpool Corpn. v. Registrar of Trade Marks and Harbanslal Sahnia v. Indian Oil Corpn. Ltd. and some other judgments, then the High Court may, after considering all the relevant parameters and public interest, pass an appropriate interim order." 24. In the case of S. Pitchi Reddy (supra), the Hon'ble Supreme Court has held as under: "Firstly, the High Court ought not to have directly entertained the writ petitions challenging the fresh assessment orders. The respective dealers assessees ought to have availed the ....
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....ave reasons to believe regarding commission of any offence. 30. In the instant case, an attempt has been made on behalf of the petitioner to submit that there were no materials which can form reasons to believe and in absence of such conditions precedent, the authorities do not assume the jurisdiction to proceed. However, a perusal of the materials would show that the impugned action is preceded by a subjective satisfaction arrived at by the competent authority based upon information received regarding commission of an offence. The said condition precedent has also been substantiated by recovery of 800 bags of areca nuts which have been stated to be of foreign (Myanmar) origin. 31. Shri Keyal, the learned Standing Counsel in his argument has vehemently contended and objected to the maintainability of the writ petition itself on the ground of availability of alternative remedy. Though availability of an alternative remedy may be a bar against invocation of the writ jurisdiction, such bar cannot be construed to be an absolute bar and as held by the Hon'ble Supreme Court, including in the case of M/s. Whirlpool Corporation (supra), under certain circumstances, like jurisdict....