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Jharkhand High Court · body

2020 DIGILAW 1057 (JHR)

Shree Durga Enterprises v. State of Jharkhand

2020-11-09

ANUBHA RAWAT CHOUDHARY, APARESH KUMAR SINGH

body2020
ORDER : Through Video Conferencing 1. Heard Mr. Deepak Kumar Sinha, learned counsel appearing on behalf of the petitioner. 2. Heard Mr. Sachin Kumar, learned A.A.G.-II appearing on behalf of the State. Arguments of the petitioner 3. Learned counsel for the petitioner submits that the petitioner is primarily aggrieved by the order dated 12.01.2016 (Annexure-7) passed by the Commercial Taxes Officer, Bokaro Circle, Bokaro (Respondent No. 4) under Section 40(2)(b) of the Jharkhand value Added Tax Act, 2005 to the extent it relates to SUGAM-P and also the consequent demand notice bearing no. 6839 dated 12.01.2016 (Annexure-8) issued by respondent no. 4 wherein the petitioner has been asked to deposit the penalty amount of Rs. 4,73,138/-. 4. Learned counsel for the petitioner further submits that although multiple prayers have been made in the present writ petition, but it can be disposed of on a short point of violation of principles of natural justice, in as much as, the notice dated 08.01.2016, by which the proceedings were initiating, was itself vague. He submits that the notice was issued pursuant to grounds mentioned in the order dated 08.01.2016, alleging non-accounting of sale as certain Forms i.e. SUGAM-P of Rs. 12,95,496.85 and SUGAM-G up to Rs. 15,77,002.62 were used but these particulars were not communicated to the petitioner in the notice dated 08.01.2016 due to which the petitioner has been denied proper opportunity to respond to the allegations resulting in gross violation of the principles of natural justice. He submits that if the allegations mentioned in the order were mentioned in the notice, the petitioner could have easily explained the facts regarding use of the forms for movement of goods and accounting of the sales. 5. The learned counsel submits that the present case is confined only to the allegation regarding SUGAM-P amounting to Rs. 12,95,496.85 mentioned in order dated 08.01.2016 as the allegations relating to SUGAM-G have been dropped by the impugned order itself. 6. The learned counsel submits that as per order dated 08.01.2016 it was alleged that although the petitioner had used SUGAM-P to the extent of Rs. 12,95,496.85 but the petitioner has shown nil return and has thus suppressed sales turnover. 7. 6. The learned counsel submits that as per order dated 08.01.2016 it was alleged that although the petitioner had used SUGAM-P to the extent of Rs. 12,95,496.85 but the petitioner has shown nil return and has thus suppressed sales turnover. 7. The learned counsel submits that while issuing the notice, the authorities have mentioned that the allegation relates to the financial year i.e. 2015-16 but the details of amount and the kind of form used in connection with which the authority had the objection, were not mentioned in the notice dated 08.01.2016 although it was mentioned in the order dated 08.01.2016 which occasioned the issuance of notice dated 08.01.2016. It is submitted that accordingly, the notice dated 08.01.2016 was vague resulting in denial of opportunity to the petitioner to appropriately respond to the allegations mentioned in order dated 08.01.2016 causing great prejudice to the petitioner. 8. Learned counsel submits that pursuant to the notice, the petitioner had responded by filing an online reply dated 11.01.2016, (the date in the reply has been wrongly mentioned as 11.01.2015) denying the allegation as reflecting in the notice and mentioning that the petitioner had no turnover between September 2015 and November 2015, but, in December 2015, there was sales turnover on SAIL/BSL. 9. The learned counsel submits that thereafter the impugned order was passed holding that the petitioner had used SUGAM-P totaling to amount of Rs. 12,95,496.85 in the month of May 2015, but no sale was reflected in the month of May. The learned counsel submits that this specific allegation regarding use of SUGAM-P to the extent of Rs. 12,95,496.85, though mentioned in the order dated 08.01.2016, was not mentioned in the notice dated 08.01.2016, and accordingly there was no occasion for the petitioner to respond to the use of SUGAM-P used in the month of May, 2015. 10. He submits that in the writ petition, the petitioner has explained their use by stating that the goods transported along with SUGAM-P used in the Month of May, 2015 to SAIL/BSL were accounted for as sale in the month of June, 2015 after receipt of GRN (goods receipt note) from Steel Authority of India Limited (SAIL). 11. The learned counsel submits that had the particulars mentioned in order dated 08.01.2016 were made available to the petitioner along with the notice, the aforesaid aspect regarding use of SUGAM-P to the extent of Rs. 11. The learned counsel submits that had the particulars mentioned in order dated 08.01.2016 were made available to the petitioner along with the notice, the aforesaid aspect regarding use of SUGAM-P to the extent of Rs. 12,95,496.85 could have been explained to the authority at the time of filing the show cause reply itself. The learned counsel submits that a vague notice is no notice in the eyes of law and impugned order passed as a result of vague notice amounts to gross violation of principles of natural justice and fair play. 12. The learned counsel for the petitioner refers to Annexure-B to the counter affidavit which gives the details of the JVAT FORM 504-P and JVAT FORM 504-G used by the petitioner. He submits that the details of SUGAM-P (JVAT FORM 504-P), which are the subject matter of the present writ petition and mentioned in Annexure-B, are as follows: Road Permit No. Purchaser Value of Goods 201430515578154 SAIL/BSL Rs. 4,21,590.00 201430515426857 SAIL/BSL Rs. 4,36,211.00 201430515166856 SAIL/BSL Rs. 4,37,695.75 He submits that the date of generation of the said permits are 25.05.2015, 25.05.2015 and 30.05.2015 respectively total being for Rs. 12,95,496.85 and mentioned in the order dated 08.01.2016 and also in the impugned order of penalty. He also submits that these SUGAM-P have been mentioned in the impugned order and are said to have been generated in the month of May, 2015. The transactions have been treated as suppression of sales turnover on the basis of which the impugned order of penalty has been levied and demand has been raised. 13. The learned counsel submits that he would be satisfied if the matter is remanded back to the concerned authority for fresh adjudication and the petitioner would not insist on any fresh notice and would respond to the allegations which have been made in order dated 08.01.2016 regarding use of SUGAM-P amounting to the extent of Rs. 12,95,496.85 and explain its position, before the authority. The learned counsel further submits that the authority may be directed to pass a fresh order after giving an opportunity of hearing to the petitioner. Arguments of the respondent-State 14. The learned counsel appearing on behalf of the State, on the other hand, has raised serious objection to the maintainability of the writ petition on the ground of availability of alternative remedy of appeal under Section 79 of the Jharkhand Value Added Tax Act, 2005. Arguments of the respondent-State 14. The learned counsel appearing on behalf of the State, on the other hand, has raised serious objection to the maintainability of the writ petition on the ground of availability of alternative remedy of appeal under Section 79 of the Jharkhand Value Added Tax Act, 2005. He relies upon two judgments passed by the Hon'ble Supreme Court, reported in (1998) 8 SCC 1 (Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai & Others) para Nos. 14 and 15 and in (2010) 8 SCC 110 (United Bank of India vs. Satyawati Tondon and Others) para 43 and submits that the Hon'ble Supreme Court has held that in financial matter the writ petitions should not be entertained where alternative remedy is available. The learned counsel has also referred to the JVAT Form-302, which is the statutory Form for issuance of notice, and submits that the basic ingredients regarding notice, are satisfied and therefore, the statutory authority has exercised its powers in accordance with law while passing the impugned order and the petitioner should be relegated to alternative remedy to raise its grievances in accordance with law. 15. However, during the course of argument, the learned counsel for the respondents is not in a position to dispute that the facts and particulars which have been mentioned in order dated 08.01.2016, are not reflecting in the notice dated 08.01.2016 which was issued to the petitioner pursuant to order dated 08.01.2016 and the notice simply mentioned the period of 2015-16. It is also not in dispute that the notice was issued on 08.01.2016, the reply was filed through e-mail on 11.01.2016 and the final impugned order was passed on 12.01.2016. Findings of this court 16. After hearing the learned counsel for the parties and considering the facts and circumstances of this case, this Court finds that the order dated 08.01.2016, inter alia, alleges that SUGAM-P used by the petitioner to the extent of Rs. 12,95,496.85 was not accounted by the petitioner as the petitioner had filed nil return. This figure is matching with the figure reflecting in Annexure-B filed by the respondents along with their counter-affidavit reflecting three transactions by the petitioner with Steel Authority of India Limited. It is further not in dispute that though the figure regarding SUGAM-P has been mentioned in the order dated 08.01.2016, but these particulars have not been mentioned in the consequent notice dated 08.01.2016. It is further not in dispute that though the figure regarding SUGAM-P has been mentioned in the order dated 08.01.2016, but these particulars have not been mentioned in the consequent notice dated 08.01.2016. It is further not in dispute that the petitioner responded to the notice by filing reply through e-mail on 11.01.2016 by denying the allegations in the notice but there was no response to the use of SUGAM-P amounting to 12,95,496.85 as apparently this allegation was not mentioned in the notice dated 08.01.2016 though mentioned in the order dated 08.01.2016. Accordingly, there was no occasion for the petitioner to figure out as to which particular transaction or transactions were referred to by the respondents while alleging incorrect filing of returns in notice dated 08.01.2016. Accordingly, there was no occasion for the petitioner to figure out as to which particular transaction or transactions were referred to by the respondents while alleging incorrect filing of returns in notice dated 08.01.2016. In order to appreciate the gap between the order dated 08.01.2016 and the notice dated 08.01.2016, both are being extracted hereinbelow and quoted as under:- Order dated 08.01.2016 ^^eq[;ky; ls izkIr vkuykbu lwpuk fn 8-1-16 es ik;k x;k gS fd lacf/kr vof/k 2015&16 es O;olk;h ds }kjk fuEu :i ls lqxe th ,oa ih dk v;ksx fd;k x;k gS- lqxe ih & :Œ1295496¾85 lqxe th & :Œ1577002¾62 blds ckotwn O;olk;h ds }kjk 'kwU; fooj.kh nkf[ky fd;k x;k gSA izFke n`”V;k ;g lcaf/kr vof/k es Ø; foØ; fNik;s tkus dk ekeyk LFkkfir gksrk gSA vr% >kj[k.M ewY;of/kZr dj vf/kfu;e 2005 dh /kkjk 40¼2½¼ch½ ,oa fu;ekoyh 59 ds vraxZr fn- 12-1-16 lquok;h dh frfFk fu/kkZfjr djrs gq, vkuykbu fMftVy lwpuk fuxZr djsA Jh ¼vLi"V½ ------------------ink fu"iknu djsaxsA^^ Notice dated 08.01.2016 ^^dk;kZy; okf.kT;&dj mik;qDr] Ckksdkjks vapy] Ckksdkjks fnukad 08-01-2016 lwpuk izsf'kr] loZJh Jh nwxkZ bUVjizkbtst fuca/ku la[;k fVu 20261400261 vof/k&2015&16 fofnr gks fd eq[;ky; ls izkIr vkWuykbZu lwpuk fnukad 08-01-2016 es ;g ik;k x;k gS fd vkids }kjk lEcfU/kr vof/k esa vkWuykbZu oS/kkfud izi= lqxe G/ lqxe P/ lqxe B ¼tks Hkh ykxw gks½ izkIr fd;k x;k gS] blds ckotwn eq[;ky; ls izkIr lwpuk ds vuqlkj ^ekwU;^ foojf.k nkf[ky dh x;h gS tks >kj[k.M ewY;of)Zr dj vf/kfu;e 2005 dh /kkjk 29 ¼1½ ds izko/kkuksa dk Hkh izFke n`"V~;k vkids }kjk fd;k x;k mYya?ku gS] ftlds vk/kkj ij vkids }kjk lacaf/kr vof/k esa Ø;@fcØh dks fNik;s tkus dk ekeyk LFkkfir gksrk gSA vr% >kj[k.M ewY;of)Zr dj vf/kfu;e 2005 dh /kkjk 40 ¼2½¼ch½ ,oa >kj[k.M ewY;of)Zr dj fu;ekoyh 2006 ds fu;e 59 ds vUrxZr funsZ'k fn;k tkrk gS fd fnukad 12-01-2016 rd v/kksgLrk{kjh ds le{k mifLFkr gksdj mDr ds vkyksd esa viuk i{k j[ksaA Sd/- 8 okf.kT;&dj mik;qDr] cksdkjks vapy cksdkjks A uksV% dEI;qVj tfur fMftVy lwpuk gS] gLrk{kj dh vko';drk ugha gSA^^ 17. Upon comparison of the order dated 08.01.2016 and notice dated 08.01.2016 it is apparent that the amount mentioned in the order regarding use of SUGAM-P and SUGAM-G have not been mentioned in the notice dated 08.01.2016. 18. It is also useful to quote the reply filed by the petitioner on 11.01.2016 to aforesaid notice dated 08.01.2016 which is as follows: "SHREE DURGA ENTERPRISES PLOT NO. 18. It is also useful to quote the reply filed by the petitioner on 11.01.2016 to aforesaid notice dated 08.01.2016 which is as follows: "SHREE DURGA ENTERPRISES PLOT NO. I/A-116(P)2, BOKARO INDUSTRIAL AREA, BOKARO STEEL CITY-827 014 Ref: SDE/DCCT/VAT/2015-16/ 11th January, 2015 To The Dy. Commissioner of Commercial Taxes, Bokaro Circle, Bokaro. TIN No. : 2026100261 Sub.: Regarding Non-releasing of Sugam (P), (B) & (G) from your site. Ref: Your E-mail Notice dated 08.01.2016. Dear Sir, With reference to your Notice dated 08.01.2016, regarding non-transaction/Sales against our CST Purchase during the year 2015-16. This is for your kind information that, we had no any Purchase Orders from SAIL/BSL, Bokaro, so we have no any turnover between September, 2015 & November, 2015. But, in December, 2015 there was near about 10 to 12 Lacs turnover on SAIL/BSL. Further, we are inform you that, we are only the supplier of M/s. SAIL/BSL, Bokaro not other Parties. So, there was no any turnover between September & November,.2015. But, there was some turnover in December, 2015 and its VAT amount to be deposited on or before 15.01.2016 by us. Now, you are therefore requested to kindly release Sugam (G), so that there is a Truck Load of Wooden materials in our favour, which staying/waiting at Jharkhand Boarder for Sugam (G). You are once again requested to kindly look in to the above matter and do the needful action in this regard. Thanking you and assuring you of our best services at all times, Yours faithfully, For Shree Durga Enterprises (K.K. Pandey) Proprietor 9308039290" 19. This Court further finds that faced with a vague notice, the petitioner had filed a reply which also did not mention anything about the use of SUGAM-P or the transactions for the month of May, 2015 whose amount was mentioned in the order dated 08.01.2016 but not mentioned in the notice dated 08.01.2016. From the perusal of the impugned order which has been passed by the authorities, it appears that the authorities have found that there was discrepancy in connection with use of SUGAM-P in the month of May, 2015 as nil return was filed for May. The petitioner has tried to explain the discrepancy in the writ petition by saying that this figure was reflected by way of sale in the month of June, 2015 after receipt for GRN (goods receipt note) from SAIL. 20. The petitioner has tried to explain the discrepancy in the writ petition by saying that this figure was reflected by way of sale in the month of June, 2015 after receipt for GRN (goods receipt note) from SAIL. 20. We are not inclined to go into the merits of the rival contentions regarding use of SUGAM-P by the petitioner in the month of May, 2015 and issuance of sale invoice in the month of June, 2015. However, the fact remains that the petitioner was never put to notice on the particulars of use of SUGAM-P which was mentioned in the order dated 08.01.2016, which was totally absent in the notice dated 08.01.2016. This amounts to gross violation of principles of natural justice and fair play causing serious prejudice to the petitioner. This Court is of the considered view that once the discrepancies were recorded in the order dated 08.01.2016, the same should have been communicated to the petitioner while issuing the notice so as to enable the petitioner to give proper response to the allegations reflecting in the order dated 08.01.2016. In such circumstances, this Court is of the considered view that the notice which was issued to the petitioner being vague in absence of particulars, there has been a gross violation of principles of natural justice while passing the impugned order of penalty. 21. In this background, the judgment of the Hon'ble Supreme Court in the case reported in (1998)8 SCC 1 (supra) may be referred, wherein the Hon'ble Supreme Court in para-15 has observed that the alternative remedy has been consistently held by the Court not to operate as a Bar at least in following contingencies, namely, where the writ petition has been filed for enforcement of any of the fundamental rights or where there has been a violation of the principles of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is under challenge. This Court also finds that in the judgment reported in (2010)8 SCC 110 , the Hon'ble Supreme Court in para-45 has held that rule of exhaustion of alternative remedy is a matter of discretion and not one of compulsion and accordingly in an appropriate case, the Court can certainly exercise such a discretion. 22. This Court also finds that in the judgment reported in (2010)8 SCC 110 , the Hon'ble Supreme Court in para-45 has held that rule of exhaustion of alternative remedy is a matter of discretion and not one of compulsion and accordingly in an appropriate case, the Court can certainly exercise such a discretion. 22. This Court is of the considered view that the present case is an appropriate case for exercise of writ jurisdiction under Article 226 of the Constitution of India, as ex-facie, the impugned order has been passed in gross violation of principles of natural justice in view of the aforesaid facts and circumstances of the case. In the aforesaid paragraphs this Court has found that the allegations which were specifically mentioned in the order dated 08.01.2016 were not mentioned in the notice dated 08.01.2016 and hence no opportunity has been given to the petitioner to respond to the allegations recorded in order dated 08.01.2016. This Court has already held that the notice itself was vague when seen in the light of the allegations recorded in order dated 08.01.2016. It is not in dispute that the impugned order relates to the allegations recorded in the order dated 08.01.2016. 23. This court also finds that in the order dated 08.01.2016, the allegations were made in connection with SUGAM-P as well as SUGAM-G but in the impugned order the allegations with regards to SUGAM-G have been dropped and accordingly the petitioner has not been prejudiced by vague notice so far as it relates to SUGAM-G and has confined its relief to the allegations relating to SUGAM-P only which was used by the petitioner to the extent of Rs. 12,95,496.85 and as per the impugned order the same were used in the month of May 2015, the details of which have been given in Annexure B to the counter affidavit which has been quoted above. The petitioner has tried to justify the use of the aforesaid SUGAM-P and has argued that had proper notice been given to the petitioner, the same could have been explained before the adjudicating officer and the petitioner is still ready to furnish explanation with regards to the use of SUGAM-P if an opportunity is granted to the petitioner. 24. The petitioner has tried to justify the use of the aforesaid SUGAM-P and has argued that had proper notice been given to the petitioner, the same could have been explained before the adjudicating officer and the petitioner is still ready to furnish explanation with regards to the use of SUGAM-P if an opportunity is granted to the petitioner. 24. Considering the totality of the facts and circumstances of this case, this court is of the considered view that the impugned order has not only been passed in gross violation of principles of natural justice but the petitioner has been highly prejudiced due to vague notice so far as it relates to use of SUGAM-P to the extent of Rs. 12,95,496.85 as mentioned in order dated 08.01.2016 but not mentioned in notice dated 08.01.2016. 25. As a cumulative effect of the aforesaid findings the impugned order of penalty dated 12.01.2016 (Annexure-7) passed by the Commercial Taxes Officer; Bokaro Circle, Bokaro (Respondent No. 4) under Section 40(2)(b) of the Jharkhand Value Added Tax Act, 2005 to the extent it relates to SUGAM-P and also the consequent demand notice bearing no. 6839 dated 12.01.2016 (Annexure-8) issued by Respondent No. 4 wherein the petitioner has been asked to deposit the penalty amount of Rs. 4,73,138/- are hereby set-aside solely on account of violation of principles of natural justice. The matter is remanded back to the Respondent No. 4 for passing fresh order after giving a proper opportunity of hearing to the petitioner to explain the allegations mentioned in order dated 08.01.2016 to the extent it relates to use of SUGAM-P mentioned in the said order. The petitioner would appear before the respondent no. 4 on 10.12.2020 along with their explanation to the aforesaid allegation mentioned in order dated 08.01.2016 relating to use of SUGAM-P and upon their appearance the Respondent No. 4 would proceed to pass appropriate order in accordance with law after giving an opportunity of hearing to the petitioner. It is made clear that this court has not gone into the merits of the explanation furnished by petitioner regarding use of SUGAM-P. 26. This writ petition is hereby allowed with the aforesaid observations and directions.