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2007 DIGILAW 1473 (MAD)

NETWORK FASHIONS v. DEPUTY COMMERCIAL TAX OFFICER, GODOWN ASSESSMENT CIRCLE, CHENNAI.

2007-04-25

A.P.SHAH, CHITRA VENKATARAMAN

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JUDGMENT Mrs. Chitra Venkataraman, J. - This writ appeal is against the order of the learned single judge dated March 1, 2007 made in W.P. No. 2295 of 2006 (Network Fashions v. Deputy Commercial Tax Officer [2009] 19 VST 526 (Mad)), dismissing the writ petition on the ground of availability of alternative remedy. The learned judge also held that there was unexplained laches on the part of the petitioner for more than six years in challenging the order of assessment dated April 1, 1998. Aggrieved by this, the petitioner is on appeal. The appellant herein is an assessee on the file of the respondent herein under the provisions of the Tamil Nadu General Sales Tax Act, 1959. He is a dealer in textiles and ready-made garments. It is stated that out of the total taxable turnover of Rs. 71,72,212, the taxable turnover up to July 31, 1996 was Rs. 12,31,761 and the balance turnover of Rs. 59,40,431 related to the period from August 1, 1996 to March 31, 1997. For the assessment year 1996-97, the petitioner was assessed to tax on a taxable turnover of Rs. 71,72,212. The same was also subjected to the levy under the provisions of the Tamil Nadu Additional Sales Tax Act. The grievance of the appellant herein is that the chargeability to additional sales tax as per the law then stood, arises only when the taxable turnover exceeded Rs. 100 crores. He submitted that for the period April 1, 1996 to July 31, 1996, the taxable limit was Rs. 10 lakhs and above and on and from August 1, 1996 as per the Amending Act 31 of 1996, the same was attracted only when the taxable turnover exceeded Rs. 100 crores. The appellant states that since the taxable turnover for the period August 1, 1996 to March 31, 1997 was Rs. 59,40,431, the question of liability under the Tamil Nadu Additional Sales Tax Act did not arise. Hence, according to the appellant, if at all there could be any liability, it is only up to the period July 31, 1996 when the taxable limit exceeded Rs. 10 lakhs. The appellant states that in spite of the objection to the respondent's proposal to assess on the entire turnover of Rs. 71,72,212, the respondent proceeded to pass the assessment order. 10 lakhs. The appellant states that in spite of the objection to the respondent's proposal to assess on the entire turnover of Rs. 71,72,212, the respondent proceeded to pass the assessment order. Thus, the respondent fixed the liability under the Tamil Nadu Additional Sales Tax Act by order dated March 20, 1998. Admittedly, the appellant did not challenge this order in appeal. The appellant herein, however, preferred an original petition before the Tamil Nadu Taxation Special Tribunal (since abolished) and challenged the jurisdiction of the respondent that as per the amended provision under Act 31 of 1996, effective from August 1, 1996, the liability itself was not there. The original petition was admitted by the Tamil Nadu Taxation Special Tribunal in O.P. No. 314 of 2004. By reason of the transfer on abolition of the Tribunal the O.P. was re-numbered as W.P. No. 2295 of 2006. Learned counsel appearing for the appellant submitted that when the very chargeability to the provisions under the Tamil Nadu Additional Sales Tax Act was under challenge as illegal and hence, beyond the powers of the respondent, and that the original petition was admitted as early as 2004 and kept pending before the Tamil Nadu Taxation Special Tribunal, the rejection of the prayer on the question of laches by this court is not sustainable in law. He submitted that the appellant had paid the additional sales tax even before the assessment order was passed, and only on coming to know about the legal position that there is no liability in his case that he preferred the original petition before the Taxation Tribunal. Heard Mr. Haja Nazirudeen, learned Special Government Pleader (Taxes), on taking notice. Considering the legal issue involved in the challenge made in the original petition before the Tamil Nadu Taxation Special Tribunal was on the chargeability of additional sales tax under the amended provision for the period August 1, 1996 to March 31, 1997 and the petition admitted and kept pending since 2004, we feel, interest of justice would be met by directing the appellant herein to seek appellate remedy by filing an appeal within a period of two weeks from today. On so filing within the time granted, the appellate authority shall consider the merits of the appeal without any reference to the question of limitation. On so filing within the time granted, the appellate authority shall consider the merits of the appeal without any reference to the question of limitation. With the above observation, we set aside the order of the learned single judge and the writ appeal is disposed of with the above direction. There will, however, be no order as to costs.