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1965 Supreme(SC) 293
SUPREME COURT OF INDIA
K. SUBBA RAO, J. C. SHAH and S. M. SIKRI JJ.
BEHARILAL SHYAMSUNDER
Versus
SALES TAX OFFICER
November 8, 1965.
K. S. VENKATARAMAN AND Co. (P.) LTD.
Versus
STATE OF MADRAS [1966] 60 I.T.R. 112(S.C) followed.
Civil Appeals Nos. 821 and 822 of 1964.
Advocates appeared
A. V. Viswanatha Sastri, Senior Advocate (T. A. Ramachandran, and O. C. Mathur of J. B. Dadachanji and Co. with him), for the appellant.
C. K. Daphtary, Attorney-General for India (N, D. Karkhanis, R. N. Sachthey and B. R. G. K. Achar with him), for the respondents.
A challenge to the validity of a tax on the ground that it is ultra vires the law is beyond the jurisdiction of sales tax authorities; therefore, the petitioner is not required to exhaust internal remedies before seeking a writ under Article 226 of the Constitution.
Headnote:(A) Constitution of India - Article 226 - Sales Tax Act - Challenge to assessment orders - Question of ultra vires - Exhaustion of internal remedies - Where the challenge is on the ground that the imposition of tax is without authority of law or ultra vires the Act and rules, such a question is foreign to the jurisdiction of the sales tax authorities - Petitioner is not required to exhaust internal remedies before approaching the High Court.
Facts of the case:
Petitions were filed under Article 226 of the Constitution to quash assessment orders on the ground that the imposition of tax was without authority of law or ultra vires the Sales Tax Act and the rules. The High Court dismissed the petitions on the ground that the petitioner had not exhausted the internal remedies available under the said Act.
Findings of Court:
The court held that the sales tax authorities cannot decide the question of ultra vires. Therefore, the High Court was incorrect in dismissing the applications on the ground that internal remedies should have been exhausted first.
Issues: Whether a petitioner must exhaust internal remedies under the Sales Tax Act when the challenge to the assessment is based on the ground that the tax is ultra vires or without authority of law.
Ratio Decidendi: The sales tax authorities can only decide disputes between the assessee and the Commissioner in terms of the provisions of the Act; the question of ultra vires is foreign to their jurisdiction. Consequently, the requirement to exhaust internal remedies does not apply to such challenges.
Result: Appeals allowed. Cases remanded.
Legal Category Hierarchy
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constitutional law
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writ jurisdiction
- article 226
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writ jurisdiction
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administrative law
- exhaustion of alternative remedies
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tax law
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sales tax
- jurisdiction of tribunals
-
sales tax
JUDGMENT
SUBBA RAO J.-These are appeals by special leave against the orders of the High Court of Orissa. dismissing the petitions filed by the appellant under article 226 of the Constitution of India to quash the notification issued by the Government of Orissa on the ground that the petitioner has "not exhausted the internal remedies under the Orissa Sales Tax Act." Learned Attorney-General appearing for the Sales Tax Officer raised a preliminary objection on the ground that the special leave petitions were filed out of time. Mr. A. V. Viswanatha Sastri appearing for the appellant contended that they were not barred. Without deciding whether they were barred or not, on that there is some dispute, we think, having regard to the circumstances of the case, that this is a fit case for excusing the delay, if any. We accordingly excuse the delay in filing the special leave petitions.
The appellant filed petitions under article 226 of the Constitution of India for issuance of a writ of mandamus or any other appropriate writ quashing the assessment orders on the ground that the imposition of tax was without authority of law or ultra vires the Sales Tax Act and the rules.
This court in K. S. Venkalaraman & Co. (P.) Ltd. v. State of Madras1 (Civil Appeal No. 618 of 1963 decided on October 18, 1965) held that the Sales Tax Tribunal could only decide disputes between the assessee and the Commissioner in terms of the provisions of the Madras General Sales Tax Act, 1939, and the question of ultra vires was foreign to its jurisdiction. For the same reason, we must hold that the question raised by the appellant before the High Court could not be decided by tie sales tax authorities under the Orissa Sale Tax Act, 1947 . The High Court, therefore, went wrong in dismissing the applications on the ground the appellant should exhaust his internal remedies under the said Act. The order of the High Court is set aside, the appeal are allowed and the matter is remanded to the High Court for disposal in accordance with law. Costs will abide the result.
Appeals allowed. Cases remanded.
For Citation : (1966) 60 ITR 260 htm
