High Court · 2012

The respondents have opposed the submissions made in the writ petition. We have heard learned counsel for the parties at length. Learned Sr. Additional Advocate General, Assam raised a preliminary obje ction that determination of the issue whether under the contract in question tra nsfer of right to use was involved or not will involve determination of disputed question of fact without the said question being first decided by the statutory authorities. He also points out that though mechanical deduction of tax at sour ce may not be permissible, the authority deducting the tax at source may go into the question of tax liability, subject to the decision of the Assessing Authori ty within a time bound manner. If the tax is deducted at source and the assessin g authority takes a different decision, the issue of refund can also be decided within a time bound manner as per direction of this Court in identical matters i ncluding in order dated 13.3.2012 in W.P.(C) No.519 of 2012 (M/s Nayak Infrastru cture Pvt. Ltd. -Vs.- State of Assam and others), wherein it was observed : (cid:28) In view of above, the writ petitions can be disposed of with a direction that the deduction should be made by determining taxable turnover as understood in law, after consideration of the view point of the dealers, within a period o f one month from the date the amount become payable. If there is dispute as to t he amount to be deducted, assessment should be made under the Act, as far as pos sible, within three months from the date of deduction. If excess amount is found to have been deducted, the same must be refunded at the earliest, in accordance with the statutory provisions and the time in making refund should not normally exceed three months. This time limit will operate till an appropriate direction is issued by the concerned authorities in accordance with law. (cid:29) Learned Additional Advocate General also fairly states that after the Co mmissioner of Taxes passed the order dated 19.3.1998, there have been new devel opments of law by way of various judicial pronouncements, including recent decis ion of this Court dated 24.7.2012 in W.P.(C) No.578 of 2009 (M/s Brahmaputra Val ley Construction and Suppliers - Vs.- The Oil and Natural Gas Corporation Ltd. a nd others). In these circumstances, the view taken in the said letter will not b e treated as conclusive and the contention raised by the petitioner will be look ed into, afresh. Learned counsel for the petitioners, however, submitted that inspite of alternative remedy, the matter could be gone into by this Court. On due consideration, we are of the view that the matter should first be gone into by the statutory authorities. It is well settled that disputed questi on of fact may not be gone into in proceedings under Article 226 of the Constit ution so as to preempt statutory authorities from exercising jurisdiction in the first instance. In United Bank of India Vs. Satyawati Tondon, (2010) 8 SCC 110 , reviewing the case law on the point, it was observed : (cid:28)47. In Thansingh Nathmal v. Supdt. of Taxes(AIR 1964 SC 1419 the Constitution B ench considered the question whether the High Court of Assam should have enterta ined the writ petition filed by the appellant under Article 226 of the Constitut ion questioning the order passed by the Commissioner of Taxes under the Assam Sa les Tax Act, 1947. While dismissing the appeal, the Court observed as under: (SC C p. 1423, para 7) (cid:28)7. & The jurisdiction of the High Court under Article 226 of the Constitution i s couched in wide terms and the exercise thereof is not subject to any restricti ons except the territorial restrictions which are expressly provided in the arti cles. But the exercise of the jurisdiction is discretionary: it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction de mands that it will ordinarily be exercised subject to certain self-imposed limit ations. Resort to that jurisdiction is not intended as an alternative remedy for relief which may be obtained in a suit or other mode prescribed by statute. Ord inarily the Court will not entertain a petition for a writ under Article 226, wh ere the petitioner has an alternative remedy, which without being unduly onerous , provides an equally efficacious remedy. Again the High Court does not generall y enter upon a determination of questions which demand an elaborate examination of evidence to establish the right to enforce which the writ is claimed. The Hig h Court does not therefore act as a court of appeal against the decision of a co urt or tribunal, to correct errors of fact, and does not by assuming jurisdictio n under Article 226 trench upon an alternative remedy provided by statute for ob taining relief. Where it is open to the aggrieved petitioner to move another tri bunal, or even itself in another jurisdiction for obtaining redress in the manne r 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 th e statute to be bypassed, and will leave the party applying to it to seek resort to the machinery so set up. (cid:29)

48. In Titaghur Paper Mills Co. Ltd. v. State of Orissa(1983) 2 SCC 433 a three- Judge Bench considered the question whether a petition under Article 226 of the Constitution should be entertained in a matter involving challenge to the order of the assessment passed by the competent authority under the Central Sales Tax Act, 1956 and corresponding law enacted by the State Legislature and answered th e same in the negative by making the following observations: (SCC pp. 440-41, pa ra 11) (cid:28)11. Under the scheme of the Act, there is a hierarchy of authorities before whi ch the petitioners can get adequate redress against the wrongful acts complained of. The petitioners have the right to prefer an appeal before the prescribed au thority under sub-section (1) of Section 23 of the Act. If the petitioners are d issatisfied with the decision in the appeal, they can prefer a further appeal to the Tribunal under sub-section (3) of Section 23 of the Act, and then ask for a case to be stated upon a question of law for the opinion of the High Court unde r Section 24 of the Act. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challe nged by the mode prescribed by the Act and not by a petition under Article 226 o f the Constitution. 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 grea t clarity by Willes, J. in Wolverhampton New Waterworks Co. v. Hawkesford (1859) 6 CBNS 336 in the following passage: (ER p. 495) ’ & There are three classes of cases in which a liability may be established foun ded upon a statute. & But there is a third class viz. where a liability not exis ting at common law is created by a statute which at the same time gives a specia l and particular remedy for enforcing it. & The remedy provided by the statute m ust be followed, and it is not competent to the party to pursue the course appli cable to cases of the second class. The form given by the statute must be adopte d 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 SC 368) and has been reaffirmed by the P rivy Council in Attorney-General of Trinidad and Tobago v. Gordon Grant & Co. Lt d.{1935 AC 532 (PC)} and Secy. of State v. Mask & Co. (1939-40) 67 IA 222. It ha s 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 di smissing the writ petitions in limine. (cid:29)

49. The views expressed in Titaghur Paper Mills Co. Ltd. v. State of Orissa (198 3) 2 SCC 433 were echoed in CCE v. Dunlop India Ltd. (1985) 1 SCC 260 in the fol lowing words: (SCC p. 264, para 3) (cid:28)3. & Article 226 is not meant to short-circuit or circumvent statutory procedur es. It is only where statutory remedies are entirely ill-suited to meet the dema nds of extraordinary situations, as for instance where the very vires of the sta tute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public justice req uire it that recourse may be had to Article 226 of the Constitution. But then th e Court must have good and sufficient reason to bypass the alternative remedy pr ovided by statute. Surely matters involving the revenue where statutory remedies are available are not such matters. We can also take judicial notice of the fac t that the vast majority of the petitions under Article 226 of the Constitution are filed solely for the purpose of obtaining interim orders and thereafter prol ong the proceedings by one device or the other. The practice certainly needs to be strongly discouraged. (cid:29) In view of above, we dispose of this petition with a direction that the issue may be gone into by Respondent no.1 and, thereafter, by the Assessing Auth ority i.e. the Superintendent of Taxes, Unit-A at Guwahati in accordance with la w within the time frame already laid down, as referred to above. If aggrieved, t he petitioner will be at liberty to take remedies against the order so passed.