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2014 DIGILAW 38 (GAU)

NAYAK INFRASTRUCTURE PVT. LTD. v. STATE OF ASSAM

2014-01-10

A.M.SAPRE, UJJAL BHUYAN

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JUDGMENT (A.M.Sapre, CJ) Heard Mr. G. N. Sahewalla, learned senior counsel for the petitioner and Mr AK Sarkar, learned Standing Counsel, NF Railways. Also heard Mr S Saikia, learned Standing Counsel, Finance Department, Govt. of Assam. By filing this writ petition under Article 226 of the Constitution of India, the petitioner has prayed for grant of following relief: “In the premises aforesaid, Your petitioner prays that Your Lordships may be pleased to call for records, issue a rule calling upon the respondents to show cause as to why a writ of mandamus be not issued directing the respondent authorities and more particularly the respondent No.4 to 8 to desist, forbear and/or restrain themselves from deducting tax at source while making payment of the bills to the petitioner on the total value of the works contract in respect of Work Order bearing No. W/362/CON/LGT-PDJ(LMG)/ Protection Work/2013/01 dated 26.09.2013 without giving deduction on account of labour charges, other deductions provided for in Section 11 and Rule 10 of the Assam Value Added Tax Rules, 2005 and other deduction as held to be allowable by the Supreme Court in Gannon Dunkarly -Vs- State of Rajasthan, 88 STC, 204 and on hearing cause or causes that may be shown and after hearing the parties be pleased to make the Rule absolute and/or pass such further order/ orders as Your Lordships may deem fit and proper. -AND- Pending disposal of the Rule, Your Lordships be further pleased to direct the respondents more particularly the Respondent No. 4 to 8 not to deduct any tax under section 47 of the Assam Value Added Tax Act, 2003 at Source from the Bills of the petitioner for the work contract in respect of the Work Order bearing No. W/362/CON/LGT-PDJ(LMG)/ Protection Work/2013/01 dated 26.09.2013 involved without first determining its taxable turnover in connection therewith and/or pass such further interim order(s) as Your Lordships may deem fit and proper in order to give interim relief to the petitioner.” In our view, having regard to the controversy raised in this petition and on examining the scheme of the Assam Value Added Tax Act, 2003 (for short, hereinafter called 'the Act'), the remedy of the petitioner (dealer) lies in the first instance to take recourse to the provisions of Section 47(b)(i) of the Act by submitting an application to the prescribed authority for determination of the issue relating to the deductions made by Railways from their bills for the work executed by the petitioner in relation to the work contract entered with the respondent (Railways). On such application being filed, the appropriate authority will decide the application in accordance with the provisions of the Act keeping in view the facts pleaded by the petitioner in their application and may consider to grant certificate or/and reject, as the case may be, after affording an opportunity to the petitioner of hearing. Indeed when the remedy of filing an application is provided under Section 47 ibid to a dealer, then it is this statutory remedy which must be resorted to by the dealer in order to resolve the dispute of the nature raised herein rather than to take recourse to the extraordinary remedy of writ petition under Article 226 of the Constitution in the High Court. Indeed Mr. S. Saikia, learned Standing Counsel, Finance Department, who appeared on behalf of the State on advance notice did not dispute this legal proposition arising in the case, so also the learned counsel appearing for the petitioner. In the light of this limited discussion, we are not inclined to entertain the writ petition for deciding the controversy on merits and grant liberty to the petitioner to take recourse to the remedy available to them under Section 47(b)(i) of the Act as mentioned above. In the light of this limited discussion, we are not inclined to entertain the writ petition for deciding the controversy on merits and grant liberty to the petitioner to take recourse to the remedy available to them under Section 47(b)(i) of the Act as mentioned above. In case, if an application is made by the petitioner to the prescribed authority under the Act, then the prescribed authority will decide the petitioner's application on its merit expeditiously, preferably within one month from the date of its submission as an outer limit. Needless to observe, the prescribed authority shall pass a reasoned order either granting certificate, if satisfied, or rejecting, as the case may be depending upon the case made out on facts as specified in the first proviso to Section 47(b)(i) of the Act. The petitioner would then be at liberty to challenge the order in appeal as provided under the Act if the order of the prescribed authority is adverse to them in any manner. Depending upon the outcome of the appeal, the assessing authority would assess the petitioner and the person concerned accordingly. It is with these directions and liberty, this writ petition stands disposed of at the motion stage and on advance notice given to learned State Counsel and without calling upon the State to file their response which, in the circumstances of the case, was not considered necessary on the factual aspect of the matter. No cost.