High Court of H.P.IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

CWP No. 1596 of 2015.

Judgement reserved on: 15.6.2015.

Date of decision: 20.6.2015.

M/s Samsung India Electronics Pvt. Ltd. …… Petitioner.

Vs.

State of H.P. & ors. ….. Respondents

Coram

The Hon’ble Mr. Justice Mansoor Ahmad Mir, Chief Justice.

The Hon’ble Mr. Justice Tarlok Singh Chauhan, Judge.

Whether approved for reporting?

1 Yes

For the petitioner : Mr. Tarun Gulati, Advocate with Mr.

Sanjeev Bhushan and Mr. Shashi

Mathews, Advocates.

For the respondents : Mr. Shrawan Dogra, Advocate

General with Mr. Romesh Verma,

Addl. A dvocate General, Mr. J.K.

Verma and Mr. Vikram Singh Thakur,

Dy. Advocate Generals.

Tarlok Singh Chauhan, Judge.

By medium of this petition, the petitioner has called in

question the show cause notice issued by respondent No. 4 on

22.12.2014 under section 16(8) of the Himachal Pradesh Value

Added Tax Act, 2005 (for short, H.P. VAT Act, 2005). The petitioner

has been asked to personally appear alongwith the r elevant

documents for the years 2010-2012 to 2014-2015 (up to 30.11.2014)

for the reason that petitioner was paying VAT at the rate of 5% on the

sale of cellphone chargers and other accessories instead of 13.75%.

Whether the reporters of the local papers may be allowed to see the Judgment? Yes

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The petitioner is further aggrieved by the show cause notice dated

30.12.2014 issued under section 46 of the Act by respondent No. 3,

which seeks to revise the assessment order dated 16.11.2012 for the

year 2011-2012 on the ground that the assessment order is not legal

and proper as the same needs to be revised on the grounds that tax

on sale of battery charger was levied at 5% whereas the same

should have been levied at 13.75% in view of the judgement of

Hon’ble Supreme Court in State of Punjab vs. Nokia India Pvt.

Ltd. AIR 2015 SC 1068.

2. The case initially came up before this court on 5.3.2015,

on which date the learned counsel for the petitioner was asked to

address arguments on the issue of maintainability of the writ petition

and the matter was ordered to be listed on 10.3.2015. On 10.3.2015,

the petitioner sought adjournment to lay motion for amendment of the

writ petition and the case was ordered to be listed on 1.4.2015. On

1.4.2015 notice on the application for amendment was issued and the

respondents prayed one week’s time to file reply to the application.

Thereafter, the matter was ordered to be listed from time to time to

consider the application for amendment. By way of amendment, the

petitioner has sought to lay challenge to the order passed by

respondent No.3 on 3.3.2015 whereby it has been directed to pay a

sum of Rs.81,16,112/- (Rupees eighty one lacs sixteen thousands

and one hundred twelve) into the appropriate government treasury within

30 days.

3. The learned counsel for the petitioner does not dispute

that there is an alternate remedy available by way of an appeal under

the H.P. VAT Act 2005, but contends that the same would not operate

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as a bar for entertainment of a petition under Articles 226, 227 of the

Constitution of India. He would contend that the rule of exclusion of

writ jurisdiction due to availability of an alternative remedy is a rule of

discretion and not one of compulsion and this has been so held by

this Bench while deciding CWP No. 4779 of 2014 titled M/s Indian

Technomac Company Ltd. vs. State of H.P. & ors. decided on

4.8.2014. He would further contend that in an appropriate case in

spite of availability of alternative remedy, a writ court would still

exercise its discretionary jurisdiction of judicial review in the following

cases:-

(1) where the writ petitioner seeks enforcement of the

Fundamental Right; or

(2) where there is a failure of principle of natural justice; or

(3) where order or proceedings are wholly without

jurisdiction or vires of the Act is challenged; or

(4) where the statutory authority has not acted in

accordance with the provisions of the enactment in

question; or in defiance of the Fundamental principles

of judicial procedure.

4. The learned counsel for the petitioner has further argued

that the impugned notice dated 22.12.2014 issued by respondent

No.4 proposing to levy penalty is without jurisdiction as no notice was

issued to assess tax at higher rate and therefore, in the absence of

assessment at higher rate, question of imposition of penalty would not

arise. He further argued that the impugned order dated 3.3.2015

passed under section 16 pursuant to notice under section 16(8) does

not impose penalty but seeks to assess tax at higher rate and in

absence of notice in form –XXIX under section 21 read with Rule 67,

no assessment could be made and therefore, the impugned order is

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without jurisdiction as it was issued without following the prescribed

procedure. The respondent No. 3, who had passed the impugned

order, cannot be regarded as an Assessing Authority under rule 73

and therefore, also the impugned order is without jurisdiction. It is

further argued that subsequent judgement of the Hon’ble Supreme

Court in Nokia’s case (supra) cannot be used to change the course

of past assessment.

5. On the other hand, t he learned Advocate General has

strenuously argued that the writ petition is not maintainable since the

alternative and efficacious remedy by way of statutory appeal is

available to the petitioner under section 45 of the H.P. VAT Act, 2005.

He further submits that the writ petition has been filed just to avoid the

deposit of tax, which is a pre-condition for the maintainability of the

appeal under section 45 (5) of the H.P. VAT Act, 2005. He therefore,

prayed for dismissal of the writ petition at the threshold.

We have heard the learned counsel for the parties and

have gone through the records of the case.

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 without jurisdiction. It may make the order

irregular or defective, but the order cannot be a nullity so long as it

has been passed by an authority which was competent to pass the

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order. There is basic difference between want of jurisdiction and an

illegal or irregular exercise of jurisdiction and if there is non-

compliance of rules of procedure, the same cannot be a ground for

granting one of the writs prayed for. In either case, the defect, if any,

can according to the procedure established by law be corrected only

by a court of appeal or revision.

7. In Janardhan Reddy & others vs. The State of

Hyderabad & others AIR 1951 SC 217, the Hon’ble Supreme Court

has held as follows:-

“6. ……. But, for the purpose of the present case, it is

sufficient to point out that even if we assume that there was some

defect in the procedure folld. at the trial, it does not follow that the

trial Ct. acted without jurisdiction. There is a basic difference

between want of jurisdiction & an illegal or irregular exercise of

jurisdiction, & our attention has not been drawn to any authority in

which mere non-compliance with the rules of procedure has been

made a ground for granting one of the write prayed for. In either

case, the 'defect, if any, can according to the procedure established

by law be corrected only by a Ct. of appeal or revision. Here, the

appellate Ct. which was competent to deal with the matter has

pronounced its judgment against the petitioners. & the manner

having been finally decided is not one to be reopened in a

proceeding under Art. 32 of the Constitution.”

8. Now in so far as the contention of the petitioner that a

subsequent judgement i.e. Nokia’s case (supra) cannot be used to

change the course of past assessment is concerned, it is more than

settled that the judgements of the courts declare the law as it was

always. Though the courts some time order that the judgements

would have prospective effect, but in absence of such restrictions, the

law declared by the courts is deemed to b e always the law so

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interpreted i.e. the law as it stood right from the beginning as per its

decision.

9. In Sarwan Kumar and another vs. Madan Lal Aggarwal

(2003) 4 SCC 147, the Hon’ble Supreme Court has held as follows:-

“20. ……..When the court decides that the interpretation given to

a particular provision earlier was not legal, it declares the law 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 vs. 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 of law which has to be applied retrospectively.

To put it differently, even where an earlier decision of the Court

operated for quite some time, the decision rendered later on would

have retrospective effect clarifying the legal position which was

earlier not correctly understood.

36. Salmond in his well-known work states;

"The theory of case law is that a judge does not make law;

he merely declares it; and the overruling of a previous

decision is a declaration that the supposed rule never was

law. Hence any intermediate transactions made on the

strength of the supposed rule are governed by the law

established in the overruling decision. The overruling is

retrospective, except as regards matters that are res

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judicatae or accounts that have been settled in the

meantime". (emphasis supplied)

11. In so far as the maintainability of the writ petition is

concerned, the facts herein are similar to the ones in M/s Indian

Technomac Company Ltd. case (supra), wherein this court was

confronted with the proposition regarding the maintainability of the

petition when an alternative remedy existed under the H.P. VAT Act,

2005 and this court held as follows:-

“6. Before we deal with the question of maintainability of the

writ petitions, we deem it proper to make a brief reference to the

averments contained in the leading writ petition, (CWP No.4779 of

2014), which are, by and large, similar in the other writ petitions. It

is averred in the writ petition that the Assessing Authority has not

heard the petitioners before making the impugned orders, and thus,

have been passed without providing sufficient opportunity of being

heard to the writ petitioners. It is also pleaded that the impugned

orders have been passed in a biased manner, under the dictation of

high officials. It is further pleaded that the impugned orders have

been passed without jurisdiction, though, during the course of

hearing, as discussed hereinabove, no such argument was

advanced to substantiate the fact that the Assessing Authority

passed the impugned orders without jurisdiction or that the said

Authority has acted with bias.

7. Now, coming to the core question of maintainability of the

writ petitions, in terms of the HP VAT Act, 2005, the Assessing

Authority is vested with the authority to pass orders and against

such orders, provision of appeal is envisaged, and the orders

passed in the appeal, 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

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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 or any officer, on whom the powers of

the Commissioner are conferred, shall be further appealable

to the Tribunal.

(3) Every order of the Tribunal, the Commissioner or any

officer exercising the powers of the Commissioner or the

Additional Excise and Taxation Commissioner posted at the

State Headquarters or the order of the Deputy Excise and

Taxation Commissioner or of the Assessing Authority or an

officer in-charge of check-post or barrier or any other officer

not below the rank of an Excise and Taxation Officer, if not

challenged in appeal or revision, shall be final.

(4) No appeal shall be entertained unless it is filed within sixty

days from the date of communication of the order appealed

against, or such longer period as the Appellate Authority may

allow, for reasons to be recorded in writing.

(5) No appeal under sub-section (1) shall be entertained by

an Appellate Authority unless such appeal is accompanied by

satisfactory proof of the payment of the tax (including interest

payable) or of the penalty, if any, imposed or both as the case

may be:

Provided that if such Authority is satisfied that the

dealer is unable to pay the tax (including interest payable)

assessed or the penalty, if any, imposed or both, he may, for

reasons to be recorded in writing, entertain an appeal without

the tax (including interest payable) or penalty or both having

been paid in full or after part payment of such tax (including

interest payable) or penalty or both.

(6) Subject to such rules of procedure as may be prescribed,

an Appellate Authority may pass such order on appeal as it

deems just and proper.

46. Revision.- (1) The Commissioner may, of his own motion,

call for the record of any proceedings which are pending

before, or have been disposed of by, any Authority

subordinate to him, for the purpose of satisfying himself as to

the legality or propriety of such proceedings or order made

therein and, on finding the proceedings or the orders

prejudicial to the interest of revenue, may pass such order in

relation thereto as he may think fit:

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Provided that the powers under this sub-section shall

be exercisable only within a period of five years from the date

on which such order was communicated.

(2) The State Government may, by notification, confer on any

officer powers of the Commissioner under sub-section (1) to

be exercised subject to such conditions and in 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.

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48. Revision to High Court. - (1) Any person aggrieved by

an order made by the tribunal under sub-section (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 state the question of law involved in the order, and it

shall be competent for the High Court to formulate the

question of law.

(3) Where an application under this section is pending, the

High Court may, or on application, in this behalf, stay recovery

of any disputed amount of tax, penalty or interest payable or

refund of any amount due under the order sought to be

revised:

Provided that no order for stay of recovery of such

disputed amount shall remain in force for more than 30 days

unless the applicant furnishes adequate security to the

satisfaction of the Assessing Authority concerned.

(4) The application for revision under sub-section (1) or

the application for stay under sub-section (3) shall be heard

and decided by a bench consisting of not less than two

judges.

(5) 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.”

9. Provision of sub section (1) of Section 45 of the HP VAT

Act, 2005 clearly provides that if the order is made by an Assessing

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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, the appeal against such order shall lie to the Deputy Excise

and Taxation Commissioner; if the order is made by the Deputy

Excise and Taxation Commissioner, the same can be appealed

before the Commissioner or the Additional Excise and Taxation

Commissioner, posted at the State Headquarters; and 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, the same is appealable

before the Tribunal. Sub Section (2) of Section 45 of the HP VAT

Act, 2005 further provides that 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 or any officer, on whom the

powers of the Commissioner are conferred, shall be appealable

before the Tribunal.

10. Admittedly, the impugned orders, in the present cases, have

been issued by the Assistant Excise and Taxation Commissioner-

cum-Assessing Authority. Therefore, remedy of appeal is available

to the petitioners as per Section 45 of the HP VAT Act, 2005.

11. Now, the question which arises 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 vs.

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

remedy to be sought in a particular forum, in a particular

way, it must be sought in that forum and in that manner and

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all the -other forums and modes of seeking remedy are

excluded.”

9. A Bench of three learned Judges of as Court, in

Titaghur Paper Mills Co. Ltd. v. State of Orissa, (1983) 2

SCC 433, held: (SCC p.440, para 11)

"11......The Act provides for a complete-machinery to

challenge an order of assessment, and the

impugned orders of assessment can only be

challenged by the mode prescribed by the Act and

not by a petition under Article 226 of the

Constitution. It is now well recognised that where

right or liability is created by a statute which gives a

special remedy for 1 enforcing it, the remedy

provided by that statute must be availed...."

10. In other words, existence of an adequate alternate

remedy is a factor to be considered by the writ court before

exercising its writ jurisdiction (See Rashid Ahmed v.

Municipal Board, Kairana, 1950 SCR 566).

11. In Whirlpool Corpn. v. Registrar of Trade Marks,

(1998) 8 SCC 1, this Court held:

"15. Under Article 226 of the Constitution, the High

Court, having regard to the facts of the case, has a

discretion to entertain or not to entertain a writ

petition. But the High Court has imposed upon itself

certain restrictions one of which is that if an effective

and efficacious remedy is available, the High Court

would not normally exercise its jurisdiction. But the

alternative remedy has been consistently held by this

Court not to operate a s a bar in at least three

contingencies, namely, where the writ petition has

been filed for the enforcement of the Fundamental

Rights or where there has been a violation of the

principle of natural justices or where the order or

proceedings are wholly without jurisdiction or the

vires of an Act is challenged......"

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14. Having said so, we have gone through the orders

passed by the Tribunal. The only determination made by the

Tribunal is with regard to the assessable value of the

commodity in question by excluding the freight/

transportation charges and the insurance charges from the

assessable value of the commodity in question. Since what

was done by the Tribunal is the determination of the

assessable value of the commodity in question for the

purpose of the levy of duty under the Act, in our opinion, the

assessee ought to have carried the matter 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

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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 vs. 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 remedy of appeal and accordingly set aside

the order of the High Court in terms of which the writ petition was

entertained. It is apt to reproduce paragraphs 24 and 25 hereunder:

“24. Section 19 provides for remedy of appeal against an

order made by the State Commission in exercise of its

powers under sub-clause (i) of Clause (a) of Section 17. If

Sections 11, 17 and 21 of the 1986 Act which relate to the

jurisdiction of the District Forum, the State Commission and

the National Commission, there does not appear any

plausible reason to interpret the same in a manner which

would frustrate the object of legislation.

25. What has surprised us is that the High Court has not

even referred to Sections 17 and 19 of the 1986 Act and the

law laid down in various judgments of this Court and yet it

has declared that the directions given by the State

Commission are without jurisdiction and that too by

overlooking the availability of statutory remedy of appeal to

the respondents.”

14. The Apex Court in a recent decision in Commissioner of

Income Tax and others vs. Chhabil Dass Agarwal, (2014) 1 SCC

603, has discussed the law, on the subject, right from the year 1859

till the date of judgment i.e. 8

th

August, 2013. We deem it proper to

reproduce paragraphs 12, 13, 15, 16 and 17 hereunder:

“12. The Constitution Benches of this Court in K.S. Rashid

and Sons vs. Income Tax Investigation Commission, AIR

1954 SC 207; Sangram Singh vs. Election Tribunal, AIR

1955 SC 425; Union of India vs. T.R. Varma, AIR 1957 SC

882; State of U.P. vs. Mohd. Nooh, AIR 1958 SC 86 and

K.S. Venkataraman and Co. (P) Ltd. vs. State of Madras,

AIR 1966 SC 1089, have held that though Article 226

confers very wide powers in the matter of issuing writs on

the High Court, the remedy of writ is absolutely

discretionary in character. If the High Court is satisfied

that the aggrieved party can have an adequate or suitable

relief elsewhere, it can refuse to exercise its jurisdiction.

The Court, in extraordinary circumstances, may exercise

the power if it comes to the conclusion that there has been

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a breach of the principles of natural justice or the

procedure required for decision has not been adopted. (See:

N.T. Veluswami Thevar vs. G. Raja Nainar, AIR 1959 SC

422; Municipal Council, Khurai vs. Kamal Kumar, (1965) 2

SCR 653; Siliguri Municipality vs. Amalendu Das, (1984) 2

SCC 436; S.T. Muthusami vs. K. Natarajan, (1988) 1 SCC

572; Rajasthan SRTC vs. Krishna Kant, (1995) 5 SCC 75;

Kerala SEB vs. Kurien E. Kalathil, (2000) 6 SCC 293; A.

Venkatasubbiah Naidu vs. S. Chellappan, (2000) 7 SCC

695; L.L. Sudhakar Reddy vs. State of A.P., (2001) 6 SCC

634; Shri Sant Sadguru Janardan Swami (Moingiri

Maharaj); Sahakari Dugdha Utpadak Sanstha vs. State of

Maharashtra, (2001) 8 SCC 509; Pratap Singh vs. State of

Haryana, (2002) 7 SCC 484 and GKN Driveshafts (India)

Ltd. vs. ITO, (2003) 1 SCC 72).

13. In Nivedita Sharma vs. 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.343-

45 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 p erson 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 of fact, and does not by assuming jurisdiction

under Article 226 trench upon an alternative remedy

provided by statute for obtaining relief. Where it is

open to the aggrieved petitioner to move another

tribunal, or even itself in another jurisdiction for

obtaining redress in the manner provided by a statute, the

High Court normally will not permit by entertaining a

petition under Article 226 of the Constitution the machinery

created under the statute to be bypassed, and will

leave the party applying to it to seek resort to the

machinery so set up.’

13. In Titaghur Paper Mills Co. Ltd. v. State of Orissa,

(1983) 2 SCC 433 this Court observed: (SCC pp. 440-41,

para 11)

‘11. … It is now well recognised that where a right or

liability is created by a statute which gives a special remedy

for enforcing it, the remedy provided by that statute only

must be availed of. This rule was stated with great clarity

by Willes, J. in Wolverhampton New Waterworks Co. v.

Hawkesford, 141 ER 486 in the following passage:

(ER p. 495)

“… There are three classes of cases in which a

liability may be established founded upon a statute.

… But there is a third class viz. where a liability

not existing at common law is created by a

statute which at the same time gives a special and

particular remedy for enforcing it. … The remedy

provided by the statute must be followed, and it is

not competent to the party to pursue the

course applicable to cases of the second class.

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The form given by the statute must be adopted

and adhered to.”

The rule laid down in this passage was approved by the

House of Lords in Neville v. London Express Newspapers

Ltd., 1919 AC 368 and has been reaffirmed by the Privy

Council in Attorney General of Trinidad and Tobago v.

Gordon Grant and Co. Ltd., 1935 AC 532 (PC) and Secy. of

State v. Mask and Co., AIR 1940 PC 105. It has also

been held to be equally applicable to enforcement of rights,

and has been followed by this Court throughout. The High

Court was therefore justified in dismissing the writ petitions

in limine.’

14. In Mafatlal Industries Ltd. v. Union of India, (1997) 5

SCC 536 B.P. Jeevan Reddy, J. (speaking for the majority

of the larger Bench) observed: (SCC p. 607, para 77)

‘77. … So far as the jurisdiction of the High Court

under Article 226—or for that matter, the

jurisdiction of this Court under Article 32—is

concerned, it is obvious 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 vs. 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

impugned order, we intend to remind ourselves the

observations made by this Court in Munshi Ram

v. Municipal Committee, Chheharta, (1979) 3 SCC

83. 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 remedy to be sought in a particular

forum, in a particular way, it must be sought in that

forum and in that manner, and all the other forums

and modes of seeking [remedy] are excluded.’”

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15. Thus, while it can be said that this Court has

recognized some exceptions to the rule of alternative

remedy, i.e., where the statutory authority has not acted

in accordance with the provisions of the enactment in

question, or in defiance of the fundamental principles of

judicial procedure, or has resorted to invoke the provisions

which are repealed, or when an order has been passed in

total violation of the principles of natural justice, the

proposition laid down in Thansingh Nathmal case AIR

1964 SC 1419, Titagarh Paper Mills case 1983 SCC (Tax)

131 and other similar judgments that the High Court will

not entertain a petition under Article 226 of the Constitution

if an effective alternative remedy is available to the

aggrieved person or the statute under which the action

complained of has been taken itself contains a mechanism

for redressal of grievance still holds the field. Therefore,

when a statutory forum is created by law for redressal of

grievances, a writ petition should not be entertained

ignoring the statutory dispensation.

16. In the instant case, the Act provides complete

machinery for the assessment/re-assessment of tax,

imposition of penalty and for obtaining relief in respect of

any improper orders passed by the Revenue Authorities,

and the assessee could not be permitted to abandon that

machinery and to invoke the jurisdiction of the High

Court under Article 226 of the Constitution when he had

adequate remedy open to him by an appeal to the

Commissioner of Income Tax (Appeals). The remedy

under the statute, however, must be effective and not a

mere formality with no substantial relief. In Ram and

Shyam Co. vs. State of Haryana, (1985) 3 SCC 267 this

Court has noticed that if an appeal is from “Caesar to

Caesar’s wife” the existence of alternative remedy would

be a mirage and 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 vs. Guwahati Carbon Limited,

Nivedita Sharma vs. Cellular Operators Association of India

and others and Commissioner of Income Tax and others vs.

Chhabil Dass Agarwal, referred to hereinabove.

16. The sum and substance of the above discussion is that the

writ petitioners-Company h ave remedies of appeal(s), before

approaching the High Court by way of the writ petitions, for the

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redressal of their grievances. The petitioners ought to have

exhausted the remedy of appeal before the Deputy Excise and

Taxation Commissioner or Additional Excise and Taxation

Commissioner or the Excise Commissioner, as the case may be,

and if the petitioners were not successful in those appeal

proceedings, another remedy available to them was to challenge

the said order(s) by the medium of appeal before the Tribunal, and

again, if they were unsuccessful, they could have availed the

remedy of revision before the High Court in terms of Section 48 of

the HP VAT Act, 2005. Keeping in view the above discussion, read

with the fact that the dispute raised in these writ petitions relates to

revenue/tax matters, it can safely be concluded that the petitioners

have sufficient efficacious remedy(ies) available.

17. It also appears that these writ petitions are aimed at to give

a slip to law for the reason that the petitioners have to deposit the

tax liability, alongwith interest payable, as assessed, and penalty, if

any, imposed, in terms of Section 45(5) of HP VAT Act, 2005,

referred to above, which provides that no appeal has to be

entertained unless it is accompanied by satisfactory proof of the

payment of tax including interest payable alongwith penalty, if any,

imposed, subject to exception provided by proviso to sub section

(5) of Section 45 of the HP VAT Act, 2005.

18. Having said so, we are of the considered view that the writ

petitioners have alternative efficacious remedy available and these

writ petitions are not maintainable. Accordingly, the same merit to

be dismissed in limine. However, it is made clear that the

observations made herein shall not cause any prejudice to the

petitioners in case they intend to file appeal(s) before the

prescribed Authority and the period spent by the petitioners for

prosecuting these writ petitions shall be excluded by the Appellate

Authority while computing the period of limitation.”

12. The judgement in M/s Indian Technomac Company

Ltd. case (supra), has attained finality, inasmuch as, the same has

been upheld by the Hon’ble Supreme Court vide its order dated

22.8.2014 in SLP (C ) Nos. 22626-22641 of 2014.

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13. At this stage, we may also take note of recent decision

of the Hon’ble Supreme Court in Union of India and others vs.

Major General Shri Kant Sharma 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 judgements as cited in M/s Indian

Technomac Company Ltd. case (supra) and in addition thereto after

taking into consideration the judgement rendered by it in Kanaiyalal

Lalchand and Sachdev and others vs. State of Maharasthra and others

(2011) 2 SCC 782, Executive Engineer, Southern Electricity Supply

Company of Orissa Limited (SOUTHCO) and another vs. Sri

Seetaram Rice Mill (2012) 2 SCC 108, Cicily Kallarackal vs. Vehicle

Factory 2012 (8) SCC 524 and Union of India vs. 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

1125) and S.N. Mukherjee) (AIR 1990 SC 1984).

(ii) The jurisdiction of the High Court under Article 226 and

this Court under Article 32 though cannot be circumscribed by the

provisions of any enactment, they will certainly have due regard

to the legislative intent evidenced by the provisions of the Acts

and would exercise their jurisdiction consistent with the

provisions of the Act.(Refer: Mafatlal Industries Ltd.).

(iii) When a statutory forum is created by law for redressal of

grievances, a writ petition should not be entertained ignoring

the statutory dispensation. (Refer: Nivedita Sharma).

(iv) The High Court will not entertain a petition under Article 226

of the Constitution if an effective alternative remedy is

available to the aggrieved person or the statute under which the

action complained of has been taken itself contains a mechanism

for redressal of grievance. (Refer: Nivedita Sharma).”

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14. Thereafter the Hon’ble Supreme Court further took into

consideration the provisions of Article 141 of the Constitution of India

and held as follows:-

“35. ….Article 141. Law declared by Supreme Court to be

binding on all courts.-The law declared by the Supreme Court

shall be binding on all courts within the territory of India.

36. In Executive Engineer, Southern Electricity Supply Company

of Orissa Limited(SOUTHCO) this Court observed that it should

only be for the specialized tribunal or the appellate authorities to

examine the merits of assessment or even the factual matrix of the

case.

In Chhabil Dass Agrawal this Court held that when a

statutory forum is created by law for redressal of grievances, a writ

petition should not be entertained ignoring the statutory

dispensation.

In Cicily Kallarackal this Court issued a direction of caution

that it will not be a proper exercise of the jurisdiction by the High

Court to entertain a writ petition against such orders against

which statutory appeal lies before this Court.

In view of Article 141(1) the law as laid down by this Court,

as referred above, is binding on all courts of India including the

High Courts.”

15. The aforesaid exposition of law makes it abundantly

clear that where an effective alternative remedy is available to the

aggrieved person, a writ petition should not be entertained.

16. Like in M/s Indian Technomac Company Ltd. case

(supra), this petition also appears to be 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

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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

dismissed in limine alongwith all pending application(s), if any. The

parties are left to bear their own costs.

(Mansoor Ahmad Mir),

Chief Justice.

June 20, 2015. ( Tarlok Singh Chauhan ),

(Hem) Judge.

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