1. Denial of input rebate under Section 14 of the MP VAT Act, 2002 — Challenge via writ petition bypassing statutory appeal under Section 46(1). (Para 2 )
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2022 Supreme(SC) 1053
SUPREME COURT OF INDIA
M.R. SHAH, KRISHNA MURARI, JJ.
State of Madhya Pradesh and Another – Appellants
Versus
Commercial Engineers and Body Building Company Limited – Respondent
Civil Appeal No. 7170 of 2022
Decided On : 14-10-2022
Important Points
The main legal point established in the judgment is the importance of exhausting statutory remedies and avoiding bypassing statutory procedures when a statutory remedy of appeal is available.
Subject
Taxation Law - Value Added Tax
Act Referred
CONSTITUTION OF INDIA: Art.226
DEBTS RECOVERY TRIBUNAL ACT: S.19
FOREIGN EXCHANGE MANAGEMENT ACT: S.35
MADHYA PRADESH VALUE ADDED TAX ACT: S.14, S.46(1)
RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT: S.20
DEBTS RECOVERY TRIBUNAL ACT: S.19
FOREIGN EXCHANGE MANAGEMENT ACT: S.35
MADHYA PRADESH VALUE ADDED TAX ACT: S.14, S.46(1)
RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT: S.20
Headnote
Input rebate - Entertainability of writ petition under Article 226 - Section 14 of the Madhya Pradesh Value Added Tax Act, 2002 - Section 46(1) of the MP VAT Act, 2002
Fact of the Case:
The State of Madhya Pradesh appealed against the High Court's judgment and order that entertained a writ petition challenging the Assessment Order denying the Input rebate under Section 14 of the MP VAT Act, 2002. The High Court set aside the Assessment Order and allowed the Input rebate in favor of the respondent.
Finding of the Court:
The Court held that the High Court should not have entertained the writ petition under Article 226 of the Constitution of India, as a statutory remedy of appeal was available under Section 46(1) of the MP VAT Act, 2002. The High Court's judgment and order were quashed and set aside, and the respondent was directed to prefer an appeal before the appellate authority.
Issues: Entertainability of writ petition under Article 226, availability of statutory remedy of appeal under Section 46(1) of the MP VAT Act, 2002
Ratio Decidendi: The Court emphasized that when a statutory remedy of appeal is available, the High Court should not entertain a writ petition under Article 226 of the Constitution of India. It referred to previous decisions highlighting the importance of exhausting alternative remedies and avoiding bypassing statutory procedures.
Final Decision: The High Court's judgment and order were quashed and set aside, and the respondent was directed to prefer an appeal before the appellate authority under Section 46(1) of the MP VAT Act, 2002. The present appeal was allowed, and no costs were awarded.
Legal Category Hierarchy
Advocates appeared:
For the Appellant(s) : Mr. Sunny Choudhary, AOR
For the Respondent(s): Mr. Vinam Gupta, AOR
For the Appellant(s) : Mr. Sunny Choudhary, AOR
For the Respondent(s): Mr. Vinam Gupta, AOR
Table of Contents
2. Whether a writ petition under Article 226 is maintainable against an assessment order when a statutory remedy of appeal is available. (Para 2 , 3 )
3. High Court erred in entertaining the writ petition solely because no disputed questions of fact existed, ignoring the available statutory appellate remedy. (Para 4 , 5 , 6 )
4. In tax matters, where an efficacious statutory remedy of appeal exists, the High Court should not entertain a writ petition under Article 226. (Para 4 , 6 )
5. High Court judgment quashed — Writ petition dismissed — Respondent relegated to prefer statutory appeal under Section 46(1) of the MP VAT Act, 2002. (Para 7 , 8 , 9 )
6. Can a writ petition be filed under Article 226 if a statutory appeal is available in tax matters?
No. In tax matters, when a statutory remedy of appeal is available, the High Court ought not to entertain a writ petition under Article 226 by bypassing the statutory remedy. (Para 4 , 6 )
7. Does the absence of disputed questions of fact justify bypassing a statutory remedy to file a writ petition?
No. The observation that no disputed questions of fact arise and the matter can be decided on admitted facts is not a valid ground to entertain a writ petition when a statutory remedy of appeal is available. (Para 5 )
8. Under what extraordinary circumstances can Article 226 be invoked despite an alternative statutory remedy?
Recourse to Article 226 is permissible only where statutory remedies are entirely ill-suited for extraordinary situations, such as when the vires of the statute is questioned or to prevent public injury and vindicate public justice. (Para 6 )
JUDGMENT
M.R. Shah, J.
1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 05.08.2015 passed by the High Court of Madhya Pradesh, Principal Seat at Jabalpur in Writ Petition No. 7628/2015, by which the Division Bench of the High Court has entertained the writ petition under Article 226 of the Constitution of India and has quashed and set aside the Assessment Order passed by the Divisional Deputy Commissioner, Commercial Tax, Jabalpur, the State of Madhya Pradesh has preferred the present appeal.
2. By an Assessment Order dated 28.02.2015, the Assessing Officer denied the Input rebate under Section 14 of the MADHYA PRADESH VALUE ADDED TAX ACT , 2002 (hereinafter referred to as the ‘MP VAT Act, 2002’) to the respondent. Without preferring an appeal against the Assessment Order denying the Input rebate under Section 46(1) of the MP VAT Act, 2002, the respondent preferred the writ petition before the High Court. Despite the specific objection raised on behalf of the State not to entertain the writ petition against the Assessment Order denying the Input rebate in view of the availability of the statutory remedy of appeal under Section 46(1) of the MP VAT Act, 2002, the High Court entertained the writ petition by observing that there are no disputed questions of facts involved in the matter and it is a question to be decided on admitted facts for which no dispute or enquiry into factual aspects of the matter is called for. That thereafter by the impugned judgment and order, the High Court has set aside the Assessment Order denying the Input rebate and consequently has allowed the Input rebate in favour of the respondent – assessee – original writ petitioner. The impugned judgment and order passed by the High Court is the subject matter of present appeal.
3. Number of submissions have been made by the learned counsel appearing on behalf of the respective parties on merits including the entertainability of the writ petition by the High Court under Article 226 of the Constitution of India challenging the Assessment Order denying the Input rebate. However, for the reasons stated hereinbelow, we propose to dismiss the writ petition preferred before the High Court and relegate the respondent – assessee – original writ petition to prefer a statutory appeal against the Assessment Order, we are not considering any other submission on merits on whether the High Court is justified in allowing the Input rebate or not.
4. Having heard learned counsel for the respective parties at length on the entertainability of the writ petition under Article 226 of the Constitution of India by the High Court against the Assessment Order and the reasoning given by the High Court while entertaining the writ petition against the Assessment Order despite the statutory remedy by way of an appeal available, we are of the opinion that the High Court ought not to have entertained the writ petition under Article 226 of the Constitution of India challenging the Assessment Order denying the Input rebate against which a statutory appeal would be available under Section 46(1) of the MP VAT Act, 2002.
5. While entertaining the writ petition under Article 226 of the Constitution of India challenging the Assessment Order denying the Input rebate, the High Court has observed that there are no disputed question of facts arise and it is a question to be decided on admitted facts for which no dispute or enquiry into factual aspects of the matter is called for. The aforesaid can hardly be a good/valid ground to entertain the writ petition under Article 226 of the Constitution of India challenging the Assessment Order denying the Input rebate against which a statutory remedy of appeal was available.
6. At this stage, a recent decision of this Court in the case of The State of Maharashtra and Others v. Greatship (India) Limited (Civil Appeal No. 4956 of 2022, decided on 20.09.2022) is required to be referred to. After taking into consideration the earlier de
