IMPORTANT POINTS
The Assessing Officer having not found anything to discredit the returns filed by the assessee or the books of accounts maintained, and relied on the turnover of another dealer that too a PSU, who incidentally also has the same business, to resort to a best judgment assessment. The onus shifts to the Assessing Officer, to prove that the operations carried on by the two dealers are similar and identical. The mere fact that both are dealing in the same product cannot lead to any irrefutable conclusion that the sale price would be the same.

JUDGMENT :

Vinod Chandran, J.

The appeal is from the judgment of a learned Single Judge relegating the petitioner-appellant to the appellate remedy as available under the Kerala Value Added Tax Act, 2003 (for brevity “KVAT Act”).

2. The question raised against the consideration of the issue on merits, by the learned Senior Government Pleader is the advisability of this Court's interference in the assessment proceedings under Article 226 of the Constitution of India, especially when the learned Single Judge has refused to exercise jurisdiction. This Court, will not, in appeal supplant a reasonable order of the learned Single Judge, merely for reason of it being more reasonable. The learned Senior Government Pleader would strenuously urge on the basis of the decision reported in Titaghur Paper Mills Co.Limited v.State of Orissa and others [(1983) 2 SCC 433] that as long as the assessment is properly made, the nitty-gritty of what has been taxed has to be properly relegated to the statutory authorities who are the fact finding authorities. There is no question of invocation of Article 226 unless the provision under which the proceedings are taken is challenged as ultra vires.

3. The learned Government Pleader fairly pointed out that Titaghur Paper Mills (supra) is a decision of a three Judge Bench of the Hon'ble Supreme Court and a co-ordinate Bench in (2005) 6 SCC 499 [State of H.P v. Gujarat Ambuja Cement Ltd.] formulated certain principles permitting invocation of Article 226 even in instances where the proceedings itself are an abuse of process of law. According to the learned Government Pleader, when there are two co-ordinate Benches on the same issue, the decision first in time has to be followed by the High Court as has been held in National Insurance Co. Ltd. v. Pranay Sethi [(2017) 16 SCC 680]. The learned Government Pleader also relied on the decisions of the Hon'ble Supreme Court in Thansingh Nathmal v. Superintendent of Taxes [AIR 1964 SC 1419] and Commissioner of Income Tax v. Chhabil Dass Agarwal [(2014) 1 SCC 603] to restrain this Court from interfering with the assessment order.

4. The learned Government Pleader has a further contention that but for the aspect of limitation there is no other ground raised by the appellant, in the writ petition as to the assessment orders being palpably wrong. We cannot countenance the said contention of the State, especially looking at the memorandum of writ petition. In challenging the assessment, the appellant has listed out four grounds, of which the second one is that there is no basis for the allegation levelled of undervaluation against the assessee. It is contended that the Assessing Officer was bound to prove that the appellant had actually received more consideration than that indicated in the invoices. We do not think that the ground raised was only on limitation.

5. Pranay Sethi elaborately considered the concept of binding precedents, especially in the context of co-ordinate Benches having spoken in different voices about an earlier judgment of the Supreme Court itself. The issue arose in the context of just compensation for a claimant under the Motor Vehicles Act, 1988. A Division Bench of the Hon'ble Supreme Court referred the question, as to whether the multiplier specified in the Second Schedule should be taken to be a guide for calculation of amount of compensation payable, to a Larger Bench. The three-Judge Bench which considered the reference in Reshma Kumari v. Madan Mohan [(2013) 9 SCC 65] approved the earlier Division Bench decision in Sarla Verma v. DTC [(2009) 6 SCC 121], wherein noticing discrepancies in the Second Schedule, a different table was provided, with guidelines laid down for using the multiplier. The three-Judge Bench in Reshma Kumari approved the table as also the guidelines laid down in Sarla Verma. Later, yet another three-Judge Bench in Rajesh v. Rajbir Singh [(2013) 9 SCC 54] explained and modified Sarla Verma. The Larger Bench considering the is