M/S. Vkn Contracts vs. Deputy Commercial Tax Officer

Facts

The petitioner, M/s.VKN Contracts, represented by its Proprietor, filed a writ petition before the Madurai Bench of the Madras High Court challenging an order dated 03.12.2024 passed by the Deputy Commercial Tax Officer, State Tax Office, Ettayapuram Circle. The impugned order pertains to the tax period April 2023-March 2024. The order was preceded by a show cause notice dated 16.09.2024. The petitioner approached the High Court without replying to the show cause notice, having 'slept over its rights'. The Court noted that such writ petitions challenging the correctness of a decision in an impugned order cannot ordinarily be entertained when the petitioner has not availed the available remedies.

Held

The Court held that while a writ petition challenging an order without replying to the show cause notice and without exhausting alternative remedies cannot ordinarily be entertained, it would come to the rescue of the petitioner under similar circumstances as in past cases. The Court decided to quash the impugned order on terms. These terms require the petitioner to deposit 25% of the disputed tax in cash from the Electronic Cash Register within 30 days of receiving the order. Additionally, the petitioner must file a reply to the show cause notice within a specified time, and the quashed order will be treated as an addendum to the show cause notice. The respondent is directed to pass a fresh order on merits after hearing the petitioner. The Court made it clear that failure to comply with these conditions would result in the writ petition being deemed dismissed. No issue was expressly left undecided.

Key Issues

1. Whether a writ petition challenging an order passed by a tax authority can be entertained when the petitioner has failed to reply to the preceding show cause notice and has approached the High Court directly without exhausting available remedies? (Question of law and mixed fact and law, turning on principles of writ jurisdiction and alternative remedies). Petitioner's contention: The petitioner sought to quash the impugned order and direct the respondent to reconsider the matter. While not explicitly stated, the act of filing the writ petition implies a challenge to the legality and correctness of the order. Respondent's contention: The respondent, represented by the Additional Government Pleader, did not explicitly argue against the maintainability of the writ petition on the grounds of non-reply to the show cause notice. However, the Court's observation that such petitions cannot be entertained suggests an implicit argument based on procedural non-compliance by the petitioner.