While hearing the M/s. Godrej Sara Lee Ltd. vs the Excise and Taxation
officer cum Assessing Authority case, the Supreme Court addressed a
jurisdictional issue, questioning the very competence of the Revisional
Authority to exercise suo motu power. In this case, the appellant
questioned the jurisdiction of the Deputy Excise and Taxation
Commissioner (ST)-cum-Revisional Authority to reopen proceedings, in the
exercise of suo motu revisional power. They also demanded “to pass
final orders holding that the two assessment orders passed by the
ETO-cum-Assessing Authority suffered from illegality and impropriety as
delineated therein, viz. That the Assessing Authority erred in levying
tax on mosquito repellant (a product manufactured by the appellant) @ 4%
instead of 10%” The High Court opined that there could be no
presumption that the appellate authority would not be able to grant the
relief sought in the writ petition; hence, the writ petition was
dismissed and the appellants were relegated to the appellate remedy. A
Special Leave Petition was registered challenging the Punjab and Haryana
High Court’s decision, dismissing the writ petition and regulating it
to the remedy of an appeal under Section 33 of the Haryana Value Added
Tax (VAT) Act, 2003.
The top Court highlighted that it was axiomatic
that “the High Courts have a discretion whether to entertain a writ
petition or not”. One of the self-imposed restrictions on the exercise
of power under Article 226, which evolved through judicial precedents
was that “the HC should normally not entertain a writ petition, where an
effective and efficacious alternative remedy is available”. Since a
jurisdictional issue was raised by the appellant in the writ petition
questioning the very competence of the Revisional Authority to exercise
suo motu power, being a pure question of law, the plea raised in the
writ petition did deserve consideration on merits and the appellant’s
writ petition ought not to have been thrown out at the threshold. The
High Court by dismissing the writ petition committed a manifest error of
law for which the order under challenge was unsustainable. Having
regard to the lapse of time (almost a life term of fourteen years) since
the orders impugned in the writ petition were made, it would not be in
the best interests of justice to remit the matter to the HC. The top
Court further illustrated that the sine qua non for the exercise of
power under section 34 was the satisfaction of the Revisional Authority
that an order has been made by a taxing authority in any proceeding
prejudicial to the interests of the State, the legality or propriety of
which appears to him to be prima facie vulnerable. Nevertheless, such
power cannot be exercised if the issue involved was pending before or
settled by an appellate authority.
The Apex Court also answered the
question “Whether the orders of the Revisional Authority seeking to
revise the orders of the Assessing Authority have been issued in
exercise of the jurisdiction conferred by law?” To which the top Court
stated that The decision of the Tribunal may not be acceptable to the
Revisional Authority, but that cannot furnish any ground to such
authority to perceive that it was either not bound by the same or that
it need not be followed. The first proviso, in such a case, gets
activated and would operate as a bar to the exercise of powers by the
Revisional Authority. To brand the orders of the Assessing Authority as
suffering from illegality and impropriety appears to be not only
unjustified but also demonstrates a thorough lack of understanding of
the principle regulating the exercise of suo motu revisional power by a
quasi-judicial authority apart from being in breach of the principle of
judicial discipline, while confronted with orders passed by a superior
Tribunal/Court. The Apex Court further invalidated the impugned final
revisional orders and allowed the appeal.
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(With input from news agency language)
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