M/S International Construction Co vs. The Assistant Commissioner(St)

Facts

The petitioner, M/s International Construction Co., was subjected to an assessment order by the Assistant Commissioner (ST) for the period 2013-2014, levying an entry tax of Rs. 4,60,597/- on the purchase of goods from other states. The petitioner contended that these goods were used as inputs in works contracts and that statutory forms were not considered. The petitioner's appeal before the Appellate Joint Commissioner (ST) was dismissed by an order dated 09.03.2021. Subsequently, the petitioner's bank account was attached. The petitioner filed a writ petition before the High Court challenging the appellate order and seeking a direction to lift the attachment and prevent coercive steps.

Held

The High Court held that while the availability of an alternative remedy does not ordinarily bar the exercise of writ jurisdiction under Article 226, courts impose a self-imposed limitation. Such jurisdiction is typically exercised only in cases involving a violation of the principles of natural justice, infringement of fundamental rights, or a challenge to the vires of a statute. In this case, the Court found no such exceptional circumstances. Therefore, the Court was not inclined to entertain the writ petition. The petitioner was relegated to the forum of the Appellate Tribunal to ventilate their grievance by filing an appeal under Section 33 of the Telangana Value Added Tax Act, 2005. The Appellate Tribunal was directed to consider the appeal in accordance with law. All contentions were kept open. The writ petition was disposed of accordingly, along with any pending interlocutory applications, with no costs.

Key Issues

1. Whether the High Court should entertain a writ petition under Article 226 of the Constitution of India when an alternative statutory remedy of appeal to the Appellate Tribunal is available to the petitioner? Petitioner's argument: The petitioner argued that the appellate authority failed to exercise its jurisdiction properly, misinterpreting legal provisions and leading to an illegal and arbitrary order. They highlighted that they had deposited the prerequisite amount for appeal admission and 35% of the disputed tax for a stay, and their bank account was attached consequent to the dismissal, causing irreparable loss. They implicitly argued that these circumstances justified bypassing the alternative remedy. Respondents' argument: The respondents, represented by the Standing Counsel for the Commercial Tax Department, contended that the petitioner has a right of appeal under Section 33 of the Telangana Value Added Tax Act, 2005. They further pointed out that due to the COVID-19 pandemic, the period of limitation for filing appeals was extended, and the petitioner would still be within the prescribed time to file an appeal before the Appellate Tribunal.