COMMISSIONER (CT) LTU KAKINADA & ORS. versus M/S. GLAXO SMITH KLINE CONSUMER HEALTH CARE LIMITED

[2020] 4 S.C.R.

AASSISTANT COMMISSIONER (CT) LTU KAKINADA & ORS.

M/S. GLAXO SMITH KLINE CONSUMERHEALTH CARE LIMITED

B(Civil Appeal No. 2413 of 2020)

MAY 06, 2020

[A. M. KHANWILKAR AND DINESH MAHESHWARI, JJ.]

Constitution of India:CArt. 226 – Jurisdiction under – Scope of – Assessment underAndhra Pradesh Value Added Tax Act, 2005 – Appeal againstassessment order filed beyond limitation period with applicationfor condonation of delay – Appeal dismissed as barred by limitation– Writ Petition u/Art. 226 seeking to quash the assessment order –High Court quashed the assessment order relegating the assesseeDto Assessing Officer for reconsideration of the matter afresh –Appeal to Supreme Court – Held: Where right or liability is createdby statute, giving special remedy for enforcing it, remedyprovided by the statute only must be availed of – The wide jurisdictionof High Court provided u/Art. 226, does not mean that it can passEorder in disregard of the substantive provisions of statute – Thestatutory appeal was filed beyond the total 60 days’ period specifiedin s.31 of 2005 Act – The appellate authority is not empowered tocondone delay of the aggregate period of 60 days – Since thestatutory period specified for filing the appeal had expired andappeal was filed without substantiating the ground for delay in filingFthe appeal, no indulgence could be shown to the assessee – the writpetition deserved to be rejected at the threshold.

Doctrine:

Doctrine of merger – Rejection of condonation of delayGapplication by appellate forum does not entail in merger of theassessment order with that order.

Allowing the appeal, the Court

HELD: 1. It is evident from s. 31 of Andhra Pradesh ValueAdded Tax Act, 2005 that the statutory appeal is required to beH

filed within 30 days from the date on which the order or proceedingwas served on the assessee. If the appeal is filed after expiry ofprescribed period, the appellate authority is empowered tocondone the delay in filing the appeal, only if it is filed within afurther period of not exceeding 30 days and sufficient cause fornot preferring the appeal within prescribed time is made out.The appellate authority is not empowered to condone delay beyondthe aggregate period of 60 days from the date of order or serviceof proceeding on the assessee, as the case may be. In the presentcase, admittedly, the appeal was filed way beyond the total 60days’ period specified in terms of Section 31 of the 2005 Act.[Para 8][614-D-F]

2. The appellate authority vide order dated 25.10.2018,considered the reasons offered by the respondent for the delayin filing of the appeal and concluded that the same were notsubstantiated with sufficient cause, and that the delay beyond theperiod of 60 days from the date of service of the assessmentorder on the respondent-assessee cannot be condoned.[Para 8][617-B]

3. The High Court finally allowed the writ petition on theground that the statutory remedy had become ineffective for therespondent (writ petitioner) due to expiry of 60 days from thedate of service of the assessment order. Inasmuch as, theappellate authority had no jurisdiction to condone the delay afterexpiry of 60 days, despite the reason mentioned by therespondent of an extraordinary situation due to the act ofcommission and omission of its employee who was in charge ofthe tax matters, forcing the management to suspend him andinitiate disciplinary proceedings against him. Soon after becomingaware about the assessment order, the respondent had filed theappeal, but that was after expiry of 60 days’ period. The HighCourt was also impressed by the contention pressed into serviceby the respondent that it ought to be given one opportunity toexplain to the authority (Assistant Commissioner) about thediscrepancies between the value reported in the CST returnsand the amount indicated in Form “F” relating to the turnover.The additional reason as can be discerned from the impugnedorder is that the respondent had already deposited an additional

Aamount equivalent to 12.5% of the disputed tax amount in termsof the earlier order. [Para 10][622-A-E]

4. Even though the High Court can entertain writ petitionagainst any order or direction passed/action taken by the Stateunder Article 226 of the Constitution, it ought not to do so as aBmatter of course when the aggrieved person could have availedof an effective alternative remedy in the manner prescribed bylaw. Although the power of the High Court under Article 226 ofthe Constitution is very wide, the Court must exercise self-imposed restraint and not entertain the writ petition, if analternative effective remedy is available to the aggrieved person.C[Para 11][623-H; 624-A-C]

Nivedita Sharma v. Cellular Operators Association ofIndia & Ors. (2011) 14 SCC 337 ; Thansingh Nathmal& Ors. v. Superintendent of Taxes, Dhubri & Ors. AIR1964 SC 1419 : [1964] 6 SCR 654 - followed.DBaburam Prakash Chandra Maheshwari v. Antarim ZilaParishad now Zila Parishad, Muzaffarnagar AIR 1969SC 556 : [1969] SCR 518 – relied on.

5. Where right or liability is created by statute, which

Egives special remedy for enforcing it, the remedy provided bythat statute must only be availed of. [Para 11][625-E]

Titaghur Paper Mills Co. Ltd. & Anr. v. State of Orissa& Ors. (1983) 2 SCC 433 : [1983] 2 SCR 743 – reliedon.

F6. The fact that the High Court has wide jurisdiction underArticle 226 of the Constitution, does not mean that it can disregardthe substantive provisions of statute and pass orders which canbe settled only through mechanism prescribed by the statute.[Para 11][626-G]

GMafatlal Industries Ltd. & Ors. v. Union of India &Ors. (1997) 5 SCC 536 : [1996] 10 Suppl. SCR 585 –relied on.

7. Indubitably, the powers of the High Court under Article226 of the Constitution are wide, but certainly not wider than theH

plenary powers bestowed on this Court under Article 142 of theConstitution. Article 142 is conglomeration and repository ofthe entire judicial powers under the Constitution, to do completejustice to the parties. Even while exercising that power, this Courtis required to bear in mind the legislative intent and not to renderthe statutory provision otiose. What this Court cannot do inexercise of its plenary powers under Article 142 of theConstitution, it is unfathomable as to how the High Court cantake different approach in the matter in reference to Article226 of the Constitution. [Paras 12 and 14][627-A-B; 632-E-F]Oil and Natural Gas Corporation Limited v. GujaratEnergy Transmission Corporation Limited & Ors. (2017)5 SCC 42 : [2017] 2 SCR 922; Singh Enterprises v.Commissioner of Central Excise, Jamshedpur & Ors.(2008) 3 SCC 70 : [2007] 13 SCR 952 ; Commissionerof Customs and Central Excise v. Hongo India PrivateLimited & Anr. (2009) 5 SCC 791 ; Chhattisgarh StateElectricity Board v. Central Electricity RegulatoryCommission & Ors. (2010) 5 SCC 23 : [2010] 4 SCR680 ; Suryachakra Power Corporation Limited v.Electricity Department represented by itsSuperintending Engineer, Port Blair & Ors. (2016) 16SCC 152 : [2016] 8 SCR 108 ; State v. Mushtaq Ahmad& Ors. (2016) 1 SCC 315 : [2015] 15 SCR 452– relied on.

8. In given case, the assessee may approach the HighCourt before the statutory period of appeal expires to challengethe assessment order by way of writ petition on the ground thatthe same is without jurisdiction or passed in excess of jurisdiction- by overstepping or crossing the limits of jurisdiction includingin flagrant disregard of law and rules of procedure or in violationof principles of natural justice, where no procedure is specified.The High Court may accede to such challenge and can alsonon-suit the petitioner on the ground that alternative efficaciousremedy is available and that be invoked by the writ petitioner.However, if the writ petitioner choses to approach the High Courtafter expiry of the maximum limitation period of 60 days

Aprescribed under Section 31 of the 2005 Act, the High Courtcannot disregard the statutory period for redressal of thegrievance and entertain the writ petition of such party as matterof course. The fact that the High Court has wide powers, doesnot mean that it would issue writ which may be inconsistentwith the legislative intent regarding the dispensation explicitlyBprescribed under Section 31 of the 2005 Act. That would renderthe legislative scheme and intention behind the stated provisionotiose. [Para 15][633-B-E]

K.S. Rashid & Son v. the Income Tax InvestigationCommission AIR 1954 SC 207 : [1954] SCR 738; ITCCLtd. & Anr. v. Union of India (1998) 8 SCC 610 –distinguished.

Electronics Corporation of India Ltd. v. Union of India& Ors. 2018 (361) ELT 22 (A.P.) ; Panoli Intermediate(India) Pvt. Ltd. v. Union of India & Ors. AIR 2015DGuj 97 ; Phoenix Plasts Company v. Commissioner ofCentral Excise (Appeal-I), Bangalore 2013 (298) ELT481 (Kar.) — not approved.

9. The remedy of appeal is creature of statute. If the appealis presented by the assessee beyond the extended statutoryElimitation period of 60 days in terms of Section 31 of the 2005 Actand is, therefore, not entertained, it is incomprehensible as tohow it would become case of violation of fundamental right,much less statutory or legal right as such. [Para 18][635-C-D]

10.1 In the present case, the respondent had asserted thatFit was not aware about the passing of assessment order dated21.6.2017 although it is admitted that the same was served onthe authorised representative of the respondent on 22.6.2017.The date on which the respondent became aware about the orderis not expressly stated either in the application for condonationGof delay filed before the appellate authority, the affidavit filed insupport of the said application or for that matter, in the memo ofwrit petition. On the other hand, it is seen that the amountequivalent to 12.5% of the tax amount came to be deposited on12.9.2017 for and on behalf of respondent, without filing an appeal

and without any demur - after the expiry of statutory period ofmaximum 60 days, prescribed under Section 31 of the 2005 Act.Not only that, the respondent filed formal application underRule 60 of the 2005 Rules on 8.5.2018 and pursued the same inappeal, which was rejected on 17.8.2018. [Para 19][635-D-G]

10.2 Furthermore, the appeal in question against theassessment order came to be filed only on 24.9.2018 withoutdisclosing the date on which the respondent in fact became awareabout the existence of the assessment order dated 21.6.2017.On the other hand, in the affidavit of the Site Director of therespondent company (filed in support of the application forcondonation of delay before the appellate authority), it is statedthat the company became aware about the irregularities committedby its erring official in the month of July, 2018, which pre-supposesthat the respondent must have become aware about theassessment order, at least in July, 2018. In the same affidavit, itis asserted that the respondent company was not aware aboutthe assessment order, as it was not brought to its notice by theemployee concerned due to his negligence. The respondent inthe writ petition has averred that the appeal was rejected by theappellate authority on the ground that it had no power to condonethe delay beyond 30 days, when in fact, the order examines thecause set out by the respondent and concludes that the samewas unsubstantiated by the respondent. That finding has not beenexamined by the High Court in the impugned judgment and orderat all, but the High Court was more impressed by the fact thatthe respondent was in position to offer some explanation aboutthe discrepancies in respect of the volume of turnover and thatthe respondent had already deposited 12.5% of the additionalamount in terms of the previous order passed by it. That reasoncan have no bearing on the justification for non-filing of the appealwithin the statutory period. No affidavit of the erring employeeor at least the other employee who was associated with the erringemployee during the relevant period, has been filed in support ofthe stand taken in the application for condonation of delay.Pertinently, no finding has been recorded by the High Court thatit was case of violation of principles of natural justice or non-compliance of statutory requirements in any manner. [Para19][635-G-H; 636-A-E]

A11. Since the statutory period specified for filing of appealhad expired long back in August, 2017 itself and the appeal cameto be filed by the respondent only on 24.9.2018, withoutsubstantiating the plea about inability to file appeal within theprescribed time, no indulgence could be shown to the respondentat all. [Para 19][636-E-F]B

12. It is not correct to say that the respondent having failedto assail the order passed by the appellate authority, dated25.10.2018 rejecting the application for condonation of delay, theassessment order passed by the Assistant Commissioner, dated21.6.2017 stood merged. Rejection of delay application by theCappellate forum does not entail in merger of the assessment orderwith that order. [Para 20][636-G-H; 637-A]

13. The High Court ought not to have entertained thesubject writ petition filed by the respondent herein. The samedeserved to be rejected at the threshold. [Para 21][637-A-B]D

Raja Mechanical Company Private Limited v.Commissioner of Central Excise, Delhi-I (2012) 12 SCC613 – relied on.

Case Law Reference

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2413of 2020.

From the Judgment and Order dated 19.11.2018 of the High Courtof Judicature at Hyderabad for the States of Telangana and AndhraPradesh in W.P. No. 39418 of 2018.

G. N. Reddy, Hemal Kirit Kumar Sheth, T. Vijaya Bhaskar Reddy,V. Lakshmikumaran, Ms. Charanya Lakshmikumaran, AadityaBhattacharya, Ms. Apeksha Mehta, Ms. Mounica Kasturi, and Ms. IshitaMathur, Advs. for the appearing parties.

The Judgment of the Court was delivered by

A. M. KHANWILKAR, J.

1. Leave granted.

2. The moot question in this appeal emanating from the judgmentand order dated 19.11.2018 in Writ Petition No. 39418/2018 passed bythe High Court of Judicature at Hyderabad for the State of Telanganaand the State of Andhra Pradesh[1] is: whether the High Court in exerciseof its writ jurisdiction under Article 226 of the Constitution of India oughtto entertain challenge to the assessment order on the sole ground thatthe statutory remedy of appeal against that order stood foreclosed bythe law of limitation?

3. The respondent is registered dealer on the rolls of AssistantCommissioner of Commercial Taxes, Large Tax Payer Unit at KakinadaDivision[2] under the provisions of Andhra Pradesh Value Added Tax Act,2005[3] and the Central Sales Tax Act, 1956[4] and is engaged in the businessof manufacturing and sale of Horlicks, Boost, Biscuits, Ghee, Ayurvedic

1 For short, “the High Court”

2 For short, “the Assistant Commissioner”

3 For short, “the 2005 Act”

4 For short, “the 1956 Act”

AMedicines etc. The Assistant Commissioner had called upon therespondent to produce books of accounts for the assessment year2013-14 for finalisation of assessment under the 1956 Act. The authorisedrepresentative of the respondent produced declaration in Form “F” insupport of its claim that certain transactions are inter-State transfers.The information and declaration furnished by the respondent was dulyBverified and after giving personal hearing to the respondent, finalassessment order came to be passed by the Assistant Commissioner on21.6.2017, raising demand of Rs.76,73,197/- (Rupees seventy six lakhsseventy three thousand one hundred ninety seven only) against turnoverof Rs.3,44,15,240/- (Rupees three crores forty four lakhs fifteen thousandCtwo hundred forty only) on the finding that the respondent had failed tosubmit Form “F” to the tune of the turnover reported in the CentralSales Tax (CST) return. This assessment order was duly served on therespondent on 22.6.2017. The respondent did not file appeal against thisassessment order within the statutory period. Instead, amount equivalent

to 12.5% of the demand was deposited on 12.9.2017. The respondentDthen filed an application under Rule 60 of the Andhra Pradesh ValueAdded Tax Rules, 2005[5], highlighting the error made in raising the demandbased on incorrect turnover reported by the respondent. This applicationwas filed only on 8.5.2018, which came to be rejected by the AssistantCommissioner vide order dated 11.5.2018. Aggrieved by the decisionEdated 11.5.2018, the respondent filed an appeal before the AppellateDeputy Commissioner of Commercial Taxes, Vijayawada[6] on 28.5.2018,which came to be rejected on 17.8.2018. It is only thereafter, therespondent-assessee was advised to file appeal before the AppellateDeputy Commissioner on 24.9.2018 against the assessment order dated21.6.2017. In the meantime, another assessment order came to be passedFon 31.3.2018 in relation to the Audit taken up for the tax period from1.4.2013 to 31.3.2017. We are not concerned with the said order in thepresent appeal.

4. Reverting to the appeal filed by the respondent against theassessment order dated 21.6.2017, the same was dismissed on 25.10.2018Gbeing barred by limitation and also because no sufficient cause wasmade out. The respondent was then advised to file writ petition beforethe High Court being Writ Petition No. 39418/2018, solely for quashing

5 For short, “the 2005 Rules”

6 For short, “the Appellate Deputy Commissioner“ or “the appellate authority”, as theHcase may be“

and setting aside of assessment order dated 21.6.2017 for tax period –April, 2013 to March, 2014 (CST) being contrary to law, withoutjurisdiction and in violation of principles of natural justice to the extent oflevy on the Branch Transfer turnovers and to direct the AssistantCommissioner (CT) to re-do the assessment and reckon the correctBranch Transfer turnover and grant exemption on the basis of Form“F”. The respondent did not challenge the order passed by the AppellateDeputy Commissioner, rejecting the statutory appeal preferred by therespondent against the assessment order dated 21.6.2017, for reasonsbest known to the respondent. The Division Bench of the High Court, on8.11.2018, noted that the respondent had already paid 12.5% of thedisputed tax, for the purpose of filing an appeal. It also noted the standtaken by the respondent that the employee who was in charge of the taxmatters of the respondent, had defaulted and was subsequently suspendedin contemplation of disciplinary proceedings, as result of which statutoryappeal could not be filed within the prescribed time. The Division Benchof the High Court directed the respondent to pay an additional amountequivalent to 12.5% of the disputed tax within one week and posted thematter for 19.11.2018. This was an ex-parte order. The respondent, interms of the stated order, deposited an additional amount equivalent to12.5% of the disputed tax amount. The writ petition was then taken upfor hearing on 19.11.2018, when after hearing the counsel for the parties,the writ petition came to be allowed and the order passed by the AssistantCommissioner, dated 21.6.2017 has been quashed and set aside and therespondent relegated before the Assistant Commissioner forreconsideration of the matter afresh after giving personal hearing to therespondent to explain the discrepancies. This order has also noted thatthe respondent had paid Rs.9,59,190/- (Rupees nine lakhs fifty-ninethousand one hundred ninety only) equivalent to the 12.5% of the taxesin the year 2013-14 (CST) on 13.11.2018.

5. Feeling aggrieved, the appellants have filed the present appeal.It is urged that the respondent having failed to avail of statutory remedyof appeal within the prescribed time and also because the delay in filingappeal had not been satisfactorily explained, the High Court ought not tohave entertained the writ petition at the instance of such person andmoreso, because the respondent had allowed the order passed by theappellate authority rejecting the appeal on the ground of delay to becomefinal. In substance, the argument is that the High Court exceeded itsjurisdiction and committed manifest error in setting aside the assessmentorder dated 21.6.2017 passed by the Assistant Commissioner.

6. The respondent, on the other hand, would urge that the HighCourt has had ample power under Article 226 of the Constitution ofIndia to grant relief to the respondent considering the peculiar facts ofthe present case being an exceptional situation which if not remedied,would result in failure of justice.

7. We have heard Mr. G.N. Reddy, learned counsel for theappellants and Mr. V. Lakshmikumaran, learned counsel for therespondent.

8. From the indisputable facts, it is evident that the assessmentorder dated 21.6.2017 was challenged by the respondent by way ofCstatutory appeal before the Appellate Deputy Commissioner only on24.9.2018. Section 31 of the 2005 Act provides for the statutory remedyagainst an assessment order. The same, as applicable at the relevanttime, reads thus: -

“31. (1) Any VAT dealer or TOT dealer or any other dealerobjecting to any order passed or proceeding recorded by anyauthority under the provisions of the Act other than an order passedor proceeding recorded by an Additional Commissioner or JointCommissioner or Deputy Commissioner, may within thirty daysfrom the date on which the order or proceeding was served onhim, appeal to such authority as may be prescribed:

Provided that the appellate authority may within furtherperiod of thirty days admit the appeal preferred after period ofthirty days if he is satisfied that the VAT dealer or TOT dealer orany other dealer had sufficient cause for not preferring the appealwithin that period:

Provided further that an appeal so preferred shall not beadmitted by the appellate authority concerned unless the dealerproduces the proof of payment of tax, penalty, interest or anyother amount admitted to be due, or of such instalments as havebeen granted, and the proof of payment of twelve and half percentGof the difference of the tax, penalty, interest or any other amount,assessed by the authority prescribed and the tax, penalty, interestor any other amount admitted by the appellant, for the relevanttax period, in respect of which the appeal is preferred.

(2) The appeal shall be in such form, and verified in such manner,Has may be prescribed and shall be accompanied by fee which

shall not be less than Rs.50/- (Rupees fifty only) but shall notexceed Rs.1000/- (Rupees one thousand only) as may beprescribed.

(3) (a) Where an appeal is admitted under sub-section (1), theappellate authority may, on an application filed by the appellantand subject to furnishing of such security or on payment of suchpart of the disputed tax within such time as may be specified,order stay of collection of balance of the tax under dispute pendingdisposal of the appeal;

(b) Against an order passed by the appellate authority refusingto order stay under clause (a), the appellant may prefer arevision petition within thirty days from the date of the order ofsuch refusal to the Additional Commissioner or the JointCommissioner who may subject to such terms and conditionsas he may think fit, order stay of collection of balance of thetax under dispute pending disposal of the appeal by the appellateauthority;

(c) Notwithstanding anything in clauses (a) or (b), wherea VAT dealer or TOT dealer or any other dealer has preferredan appeal to the Appellate Tribunal under Section 33, the stay,if any, ordered under clause (b) shall be operative till the disposalof the appeal by such Tribunal, and, the stay, if any orderedunder clause (a) shall be operative till the disposal of the appealby such Tribunal, only in case where the AdditionalCommissioner or the Joint Commissioner on an applicationmade to him by the dealer in the prescribed manner, makesspecific order to that effect.

(4) The appellate authority may, within period of two years fromthe date of admission of such appeal, after giving the appellant anopportunity of being heard and subject to such rules as may beprescribed:

(a) confirm, reduce, enhance or annul the assessment or thepenalty, or both; or

(b) set aside the assessment or penalty, or both, and direct theauthority prescribed to pass fresh order after such furtherenquiry as may be directed; or

(c) pass such other orders as it may think fit.

A(4A) Where any proceeding under this section has been deferredon account of any stay orders granted by the High Court orSupreme Court in any case or by reason of the fact that an appealor other proceeding is pending before the High Court or theSupreme Court involving question of law having direct bearingon the order or proceeding in question, the period during whichBthe stay order is in force or the period during which such appealor proceeding is pending, shall be excluded, while computing theperiod of two years specified in sub-section (4) for the purpose ofpassing appeal order under this section.

(5) Before passing orders under sub-section (4), the appellateCauthority may make such enquiry as it deems fit or remand thecase to any subordinate officer or authority for an inquiry andreport on any specified point or points.

(6) Every order passed in appeal under this section shall, subjectto the provisions of sections 32, 33, 34 and 35 be final.”D

Going by the text of this provision, it is evident that the statutoryappeal is required to be filed within 30 days from the date on which theorder or proceeding was served on the assessee. If the appeal is filedafter expiry of prescribed period, the appellate authority is empoweredto condone the delay in filing the appeal, only if it is filed within furtherEperiod of not exceeding 30 days and sufficient cause for not preferringthe appeal within prescribed time is made out. The appellate authority isnot empowered to condone delay beyond the aggregate period of 60days from the date of order or service of proceeding on the assessee, asthe case may be. In the present case, admittedly, the appeal was filedFway beyond the total 60 days’ period specified in terms of Section 31 ofthe 2005 Act. In that, the respondent had filed the appeal accompaniedby an application for condonation of delay setting out reasons in thefollowing words: -

“2. It is submitted that the impugned Order-in-Original datedG21.06.2017 was received by the Applicant on 22.06.2017 and theappeal ought to have been filed by the applicant on 21.07.2017 interms of section 31 of the Andhra Pradesh VAT Act, 2005. Thus,there is delay in filing the appeal. The Applicants further submitsthat the delay is not due to any negligence on part of the Applicant.

3. It is submitted that the impugned order was received byMr. P. Sriram Murthy, but the receipt of this assessment orderwas not informed to any other person of the company.

4. Mr. P. Sriram Murthy was authorized to handle day to dayaffairs of sales tax (VAT), service tax and excise and he was alsoauthorized to sign and submit documents with the tax departments,file periodic tax returns and represent the company beforeConcerned tax authorities.

5. However, the company has alleged Mr. P. Sriram Murthy withcommitting certain irregularities for past more than 12 monthsand initiated disciplinary proceedings against him. He has beensuspended from his official duties with effect from 26[th] July 2018.

6. It is only post his suspension that the Applicant came to knowabout the receipt of impugned order. Also, the Appellant has cometo know that Mr. Murthy paid the 12.5% of the demand amounton 12.09.2017 as if it is regular tax payment. Further, since hedid not file the appeal in time, therefore to protect himself fromthe disciplinary action, he adopted alternate route and filedrectification application under rule 60 which is not permissibleunder law in case demand has been raised on technical grounds.

7. separate affidavit as to the facts of the case is also attachedherewith.

8. It is stated that in view of the facts and circumstances mentionedabove and in the attached affidavit, your honor would appreciatethat the delay in filing the appeal is completely unintentional andfor the bona fide reasons stated above. The applicant companyshould not be imposed with tax liabilities due to inaction andmalafide intention on one employee. The Applicants further submitthat if the delay in filing the above numbered appeal is notcondoned, the Applicant would be put to great injustice andirreparable injury. On the other hand, no prejudice would be causedif the delay is condoned.

WHEREFORE, it is prayed that the Ld. Appellate JointCommissioner (ST) be pleased to allow the application forcondonation of delay as prayed for.”

As stated in the application for condonation of delay in filing thestatutory appeal, the respondent caused to file affidavit of Mr. SreedharRouth, son of Late Mr. R. Seetha Rama Swamy, who was working asSite Director in the respondent company. In this affidavit, in support ofthe application for condonation of delay, it is averred thus: -

That Mr. P. Sriram Murthy, Deputy Manager-Finance, wasauthorized to handle day to day affairs of sales tax (VAT), servicetax and excise. He was also authorized to sign and submitdocuments with the tax departments, file periodic tax returns andCrepresent the company before concerned tax authorities.

that the CST assessment for the period 2013-14 was completedby the Assistant Commissioner (CT) LTU raising demand ofRs.76,73,197/- vide assessment order dated 21.06.2017.

that the assessment order was received by Mr. P. Sriram Murthy.DBut, the receipt of this assessment order was not informed to anyother person of the company.

that Mr. P. Sriram Murthy filed application under Rule 60 of theAndhra Pradesh Act, 2005 without informing the company aboutsuch filing.

that Mr. P. Sriram Murthy also engaged Chartered Accountantand filed an appeal against rejection of application filed under rule60. The appointment of Chartered Accountant and filing this appealwas also not informed to the company.

that the company has alleged Mr. P. Sriram Murthy with committingFcertain irregularities and initiated disciplinary proceedings againsthim.

that Mr. P. Sriram Murthy has been suspended from his officialduties with effect from 26[th] July 2018. Investigation in this matteris going on.

that it is only post his suspension that we have come to knowabout the demand of Rs.76,73,197/- lakhs raised vide CSTassessment order for the year 2013-2014 and therefore could notrespond or take any action in respect of this order/demand.

It is prayed that the Ld. Appellate Joint Commissioner (ST) bepleased to allow the application for condonation of delay as prayedfor.”

The appellate authority vide order dated 25.10.2018, consideredthe reasons offered by the respondent for the delay in filing of the appealand concluded that the same were not substantiated with sufficient cause.On that finding including that the delay beyond the period of 60 daysfrom the date of service of the assessment order on the respondent-assessee cannot be condoned, the appellate authority observed thus: -

“However, to abide the principles of natural justice, theappellant has been issued notices dated 03.10.2018 and 19.10.2018to appear for admission hearings to be held on 10.10.2018 and25.10.2018 respectively, in the office of Appellate DeputyCommissioner (CT), Vijayawada for explaining reasons and hiscontentions in support of the admission of appeal petition. TheA.R. appeared for the admission hearing on 25.10.2018 andprayed for admission of appeal petition, but not submittedany reliable grounds and substantial documentary evidencein support of their submission that they were unaware ofthe receipt of original assessment order.

It is further pertinent here to record that after receiving theoriginal assessment order, the appellant-dealer has filed requestletter before the assessing authority for re-assessment under rule60 of APVAT Rules, 2005. However, the AA has not consideredre-assessment request, and issued an endorsement dt.11.05.2018,rejecting the re-assessment request. The appellant also filed anappeal on such endorsement. That appeal petition based onendorsement has also not been admitted in this office and rejectedvide ADC’s orders no. 3470, dt. 17.08.2018. Therefore, cannotbe assumed under any circumstances, and by no stretch ofimagination that the appellant-dealer was not aware of the serviceof original assessment orders. Hence, it is to be affirmed that thecauses put-forth for delay condonation are not rational and againstthe facts of the case. It is also relevant here to state that whatevermay be circumstances, the delay beyond 60 days could not becondonable in the hands of the appellate authority, therefore, suchrequest prima-facie is not in tune with the provisions of the Act,hence, liable to be rejected.

From the aforesaid discussion, it is construed that nofavourable grounds can be made to admit the appeal, since theappellant have failed to file appeal petition within the prescribedtime under APVAT Act, 2005. It is also pertinent here to note thatthe Department has duly served the original assessment order tothe appellant without any procedural lapse, and also the appellanthas admitted that the original orders were received on 22.06.2017.

In view of the above, since the appellant failed to prefer anappeal on the original assessment order dated 21.06.2017, whichwas duly served on the appellant, and as such the originalassessment order has become final, and the present appeal filedby the appellant on 24.09.2018 with delay of 1 year 62 days,hence cannot be admitted.

Further the appellants have not submitted any validreasons/sufficient cause for not preferring the appeal withinthe prescribed & condonable time of 30+30=60 days ofreceipt of the original assessment order. Hence the appealpetition is hereby REJECTED as per the provisions ofSection 31 of APVAT Act.”

(emphasis supplied)

The appellate authority was pleased to reject the explanation thatthe respondent was not aware of the service of assessment order, as itremained unsubstantiated by the respondent. When the matter travelledto the High Court, the Division Bench, after hearing the respondent,proceeded to pass an ex-parte order on 8.11.2018, which reads thus: -

“ORDER:

It is represented by Mr. S. Dwarakanath, learned counselfor the petitioner that the petitioner has already paid 12.5% of thedisputed tax, for the purpose of filing an appeal. But, the employee,who was incharge and who was subsequently, suspended incontemplation of disciplinary proceedings, failed to file the appeal.The contention of the learned counsel for the petitioner is that theissue lies in narrow campus.

Since the petitioner has already paid 12.5% of the disputedtax, the request of the petitioner for granting one more opportunitywould be considered favourably, if the petitioner pays an additional

amount equivalent to 12.5% of the disputed tax. The petitionershall make such payment within period of one week.

Post on 19.11.2018 for orders.”

Be it noted that the respondent was advised to file writ petitionmerely for setting aside of the assessment order dated 21.6.2017,presumably, in light of the decision of Full bench of the same High Courtin Electronics Corporation of India Ltd. vs. Union of India & Ors.[7].

9. We may advert to the assertions made in the writ petition (onthe basis of which the High Court was pleased to grant relief to therespondent), to explain the delay in filing of the statutory appeal includingthe reason why the respondent should be given one opportunity. Thesame read thus: -

7. From the above, it can be summarized that the total disputeddemand has arisen on account of two reasons. Firstly, the 1[st]Respondent has considered the total branch transfer turnover asper monthly CST returns and ignored the revised turnover as perVAT 200-B. Even though, the such revised stock transfer valuewas considered by the 1[st] Respondent while computing the ITCcredit as per rule 20 (8) of AP VAT act. Secondly, receipt ofexcess forms on account of inclusion of value of freebies, freesamples etc. by receiving state while issuing the Forms. The 1[st]Respondent treated these excess Forms value as concealmentby the petitioner and levied tax even, on this branch transfer valueduly covered by Forms which is [sic] grossly against the principleof law.

8. It is submitted that the order was served on the petitioner on22.6.2017 against which, the Petitioner could have preferred appealbefore the 2[nd] Respondent within 30 days from the said date.Unfortunately, no steps were taken to file any appeal within thedue date for the reason that the day to day affairs of the SalesTax, Service Tax and Excise Law was being handled by oneMr. P. Sri Ram Murthy, who was working as Deputy Manager(Finance) in the Company, who failed to take ‘appropriate stepsto prefer an appeal within time, by his negligence. Excepting

Mr. P. Sri Ram Murthy, there was no other person who was wellconversant with the facts and the steps to be taken against theassessment order. The other person Mr. Siddhant Belgaonker,Senior Manager (Finance) who attended the assessment hearingalso left the services of the Petitioner on 31.1.2018. Consequently,the assessment order remained uncontested.

9. It is respectfully submitted that apart from this act of negligence,Mr. P. Sri Ram Murthy also committed certain other irregularitiesover period of one year, which came to the light of theManagement of the Company in the month of July, 2018.Immediately, disciplinary proceedings were initiated against him,by issuing notice on 26.7.2018 (ex. P-3) and also suspendinghim from official duties with immediate effect.

10. It is submitted that the Petitioner was not aware of the impugnedorder since that fact was not brought to the notice by its ownemployee, due to this negligence.

11. It appears, the said Mr. P. Sri Ram Murthy having realized hisnegligence, made further mistake, by filing an application underRule 60 of the APVAT Rules read with Rule 14-A(10) of theCST (AP) Rules on 9.5.2018 (Ex. P-4) contending, inter-alia, thatthe revised value of stock transfer as per VAT 200-B should haveEbeen considered instead of Rs.866,25,15,490/-. In the saidrepresentation, it is claimed that it has filed revised returns underthe VAT Act, disclosing the correct ‘F’ form turnover for thepurposes of restricting the input tax credit while filing Form 200-B at the end of the year. The ITC credit under VAT was alsoFallowed by the 1[st] Respondent, considering the stock transferturnover as Rs.863,33,95,259/-. In the said representation, it wascontended that the turnover of Rs.1,85,03,360/-, could not havebeen levied with the tax since it is admittedly covered by ‘F’ forms.

12. The representation of the Petitioner under Rule 60 was rejectedby the 1[st] Respondent, by endorsement, dated 11.5.2018(Ex. P-5) on the ground, that it is not case for considering it asa mistake rectifiable under Rule 60. It is also submitted that Mr.P. Sri Ram Murthy appear to have filed an appeal against theendorsement of the 1[st] Respondent dated 11.5.2018 to 2[nd]Respondent on 28.5.2018. This was also without knowledge ofthe petitioner’s management.

13. It is submitted that the Petitioner was not aware of thesedevelopments till the misdeeds of Mr. P. Sri Ram Murthy werebeing enquired into. It is submitted that Mr. P. Sri Ram Murthyhas in fact, remitted an amount of Rs.9,59,150/- being 12.5% ofthe disputed tax in the assessment order online, on 12.9.2017 (Ex.P-6). The payment was made as if it is towards miscellaneoustax payment for June, 2014. When the Petitioner was seeking toreconcile as to how this amount was deposited and under whataccount it came to known it is for the purpose of preferring anappeal against the impugned order. All this verification happenedpost suspension of Mr. P. Sri Ram Murthy.

14. The Petitioner faced with this unfortunate situation, filed anappeal under Section 31 of the VAT Act on 24.9.2018 on the bonafide belief that there are good grounds for condonation of thedelay since the Petitioner cannot suffer for the errors committedby one of its employees.

15. It is submitted that the 2[nd] Respondent, vide order, dated25.10.2018 (Ex. P-7), rejected the appeal on the ground that hehas no power to condone the delay beyond 30 days. It is alsoobserved in the said order that appeal against the Endorsementwas also dismissed by him on 17.8.2018. However, copy of theorder is not yet served on the petitioner. The 2[nd] Respondentobserved that the Petitioner cannot dispute the service ofassessment order on 22.6.2017 and failure to file the appeal within60 days would mean that the assessment order has attained finality.16. The petitioner submits that filing of further appeal to theAPVAT Appellate Tribunal at Visakhapatnam is futile exercise,since as creature under the Act, the Tribunal cannot find faultwith the 2[nd] Respondent for not condoning the delay beyond 30days.

17. The petitioner has lost the appellate remedy by efflux of time.It does not mean that the Petitioner should be left remediless. Thepetitioner submits that full Bench of this Hon’ble Court inElectronics Corporation of India Limited (Writ Petition Nos. 9482and 9485 of 2017, dated 13.3.2018, dealing with similar situation,under Central Excise Act, held that even if the appeal time underthe Act has expired, it does not prevent the assessee from preferringa Writ Petition under Article 226 of the Constitution.”

A10. The High Court finally allowed the writ petition vide theimpugned judgment and order on the ground that the statutory remedyhad become ineffective for the respondent (writ petitioner) due to expiryof 60 days from the date of service of the assessment order. Inasmuchas, the appellate authority had no jurisdiction to condone the delay afterexpiry of 60 days, despite the reason mentioned by the respondent of anBextraordinary situation due to the act of commission and omission of itsemployee who was in charge of the tax matters, forcing the managementto suspend him and initiate disciplinary proceedings against him. Soonafter becoming aware about the assessment order, the respondent hadfiled the appeal, but that was after expiry of 60 days’ period. The HighCCourt was also impressed by the contention pressed into service by therespondent that it ought to be given one opportunity to explain to theauthority (Assistant Commissioner) about the discrepancies betweenthe value reported in the CST returns and the amount indicated in Form“F” relating to the turnover. The additional reason as can be discernedfrom the impugned order is that the respondent had already deposited anDadditional amount equivalent to 12.5% of the disputed tax amount interms of the earlier order. We deem it apposite to reproduce the impugnedorder of the High Court. The same reads thus: -

EThe impugned order of assessment is dated 21.6.2017. Asagainst the said order the petitioner filed an appeal with delay.Since the delay was beyond the period after which it can becondoned, the same was not entertained. Therefore, the petitionerhas come up with the above writ petition.

The reason stated by the petitioner is that one of theemployees who was in charge, indulged in malpractices forcingthe management to suspend him and initiate disciplinaryproceedings. The petitioner claims that they were not aware ofthese orders. Therefore, the petitioner seeks one opportunity.

The reason why the petitioner seeks one opportunity is that‘F’ forms submitted by the petitioner were rejected by theAssessing Officer, on the ground that the value of the goodstransferred to branch office have not been disclosed in ‘F’ forms.But the claim of the petitioner is that the value was wrongly reportedin the CST returns and that the amount indicated in the ‘F’ forms

was more than the turnover. Therefore, they seek one opportunityto explain this discrepancy.

In view of the peculiar circumstances, even while grantingan opportunity to the petitioner, we wanted to put them on condition.Therefore, on 8.11.2018 we passed an interim order to the followingeffect,

“It is represented by Mr. S. Dwarakanath, learnedcounsel for the petitioner that the petitioner has already paid12.5% of the disputed tax, for the purpose of filing an appeal.But, the employee, who was incharge and who wassubsequently, suspended in contemplation of disciplinaryproceedings, failed to file the appeal. The contention of thelearned counsel for the petitioner is that the issue lies in anarrow campus.

Since the petitioner has already paid 12.5% of thedisputed tax, the request of the petitioner for granting one moreopportunity would be considered favourably, if the petitionerpays an additional amount equivalent to 12.5% of the disputedtax. The petitioner shall make such payment within period ofone week.

Post on 19.11.2018 for orders.”

Pursuant to the aforesaid order, the petitioner made paymentof Rs.9,59,190/-, representing 12.5% of the taxes for the year2013-2014 (CST). The amount was paid on 13.11.2018.

Therefore, the writ petition is ordered, the impugned orderis set aside and the matter is remanded back to the 1[st] respondent.The petitioner shall appear before the 1[st] respondent on 10.12.2018and explain the discrepancies. After such personal hearing, the1[st] respondent may pass orders afresh.

As sequel, pending miscellaneous petitions, if any, shallstand closed. No costs.”

11. In the backdrop of these facts, the central question is: whetherthe High Court ought to have entertained the writ petition filed by therespondent? As regards the power of the High Court to issue directions,orders or writs in exercise of its jurisdiction under Article 226 of theConstitution of India, the same is no more res integra. Even though the

AHigh Court can entertain writ petition against any order or directionpassed/action taken by the State under Article 226 of the Constitution, itought not to do so as matter of course when the aggrieved personcould have availed of an effective alternative remedy in the mannerprescribed by law (see Baburam Prakash Chandra Maheshwari vs.Antarim Zila Parishad now Zila Parishad, Muzaffarnagar[8]and alsoBNivedita Sharma vs. Cellular Operators Association of India &Ors.[9]). In Thansingh Nathmal & Ors. vs. Superintendent of Taxes,Dhubri & Ors.[10], the Constitution Bench of this Court made it amplyclear that although the power of the High Court under Article 226 of theConstitution is very wide, the Court must exercise self-imposed restraintCand not entertain the writ petition, if an alternative effective remedy isavailable to the aggrieved person. In paragraph 7, the Court observedthus: -

“7. Against the order of the Commissioner an order for referencecould have been claimed if the appellants satisfied theDCommissioner or the High Court that question of law arose outof the order. But the procedure provided by the Act to invoke thejurisdiction of the High Court was bypassed, the appellants movedthe High Court challenging the competence of the ProvincialLegislature to extend the concept of sale, and invoked theextraordinary jurisdiction of the High Court under Article 226 andEsought to reopen the decision of the Taxing Authorities on questionof fact. The jurisdiction of the High Court under Article 226 of theConstitution is couched in wide terms and the exercise thereof isnot subject to any restrictions except the territorial restrictionswhich are expressly provided in the Articles. But the exercise

Fof the jurisdiction is discretionary: it is not exercisedmerely because it is lawful to do so. The very amplitude ofthe jurisdiction demands that it will ordinarily be exercisedsubject to certain self-imposed limitations. Resort thatjurisdiction is not intended as an alternative remedy forrelief which may be obtained in suit or other modeGprescribed by statute. Ordinarily the Court will not entertaina petition for writ under Article 226, where the petitionerhas an alternative remedy, which without being unduly

8 AIR 1969 SC 5569 (2011) 14 SCC 337H10 AIR 1964 SC 1419

onerous, provides an equally efficacious remedy. Again theHigh Court does not generally enter upon determination ofquestions which demand an elaborate examination of evidence toestablish the right to enforce which the writ is claimed. The HighCourt does not therefore act as court of appeal againstthe decision of court or tribunal, to correct errors of fact,and does not by assuming jurisdiction under Article 226trench upon an alternative remedy provided by statute forobtaining relief. Where it is open to the aggrieved petitionerto move another tribunal, or even itself in anotherjurisdiction for obtaining redress in the manner providedby statute, the High Court normally will not permit byentertaining petition under Article 226 of the Constitutionthe machinery created under the statute to be bypassed,and will leave the party applying to it to seek resort to themachinery so set up.”

(emphasis supplied)

We may usefully refer to the exposition of this Court in TitaghurPaper Mills Co. Ltd. & Anr. Vs. State of Orissa & Ors.[11], wherein it isobserved that where right or liability is created by statute, whichgives special remedy for enforcing it, the remedy provided by thatstatute must only be availed of. In paragraph 11, the Court observedthus: -

“11. Under the scheme of the Act, there is hierarchy of authoritiesbefore which the petitioners can get adequate redress against thewrongful acts complained of. The petitioners have the right toprefer an appeal before the Prescribed Authority under sub-section(1) of Section 23 of the Act. If the petitioners are dissatisfied withthe decision in the appeal, they can prefer further appeal to theTribunal under sub-section (3) of Section 23 of the Act, and thenask for case to be stated upon question of law for the opinionof the High Court under Section 24 of the Act. The Act providesfor complete machinery to challenge an order ofassessment, and the impugned orders of assessment canonly be challenged by the mode prescribed by the Act andnot by petition under Article 226 of the Constitution. It is

ABC

now well recognised that where right or liability is createdby statute which gives special remedy for enforcing it,the remedy provided by that statute only must be availedof. This rule was stated with great clarity by Willes, J.in Wolverhampton New Waterworks Co. v. Hawkesford [(1859)6 CBNS 336, 356] in the following passage:

There are three classes of cases in which liability may beestablished founded upon statute. . . . But there is third class,viz. where liability not existing at common law is created bya statute which at the same time gives special and particularremedy for enforcing it…. The remedy provided by the statuteCmust be followed, and it is not competent to the party to pursuethe course applicable to cases of the second class. The formgiven by the statute must be adopted and adhered to.

The rule laid down in this passage was approved by the House ofLords in Neville v. London Express Newspapers Ltd. (1919 ACD368) and has been reaffirmed by the Privy Council in Attorney-General of Trinidad and Tobago v. Gordon Grant & Co.Ltd. (1935 AC 532) and Secretary of State v. Mask & Co. (AIR1940 PC 105). It has also been held to be equally applicable toenforcement of rights, and has been followed by this CourtEthroughout. The High Court was therefore justified in dismissingthe writ petitions in limine.”

(emphasis supplied)

In the subsequent decision in Mafatlal Industries Ltd. & Ors.vs. Union of India & Ors.[12], this Court went on to observe that an ActFcannot bar and curtail remedy under Article 226 or 32 of the Constitution.The Court, however, added word of caution and expounded that theconstitutional Court would certainly take note of the legislative intentmanifested in the provisions of the Act and would exercise its jurisdictionconsistent with the provisions of the enactment. To put it differently, theGfact that the High Court has wide jurisdiction under Article 226 of theConstitution, does not mean that it can disregard the substantive provisionsof statute and pass orders which can be settled only through amechanism prescribed by the statute.

12. Indubitably, the powers of the High Court under Article 226 ofthe Constitution are wide, but certainly not wider than the plenary powersbestowed on this Court under Article 142 of the Constitution. Article 142is conglomeration and repository of the entire judicial powers underthe Constitution, to do complete justice to the parties. Even whileexercising that power, this Court is required to bear in mind the legislativeintent and not to render the statutory provision otiose. In recent decisionof three-Judge Bench of this Court in Oil and Natural GasCorporation Limited vs. Gujarat Energy Transmission CorporationLimited & Ors.[13], the statutory appeal filed before this Court was barredby 71 days and the maximum time limit for condoning the delay in termsof Section 125 of the Electricity Act, 2003 was only 60 days. In otherwords, the appeal was presented beyond the condonable period of 60days. As result, this Court could not have condoned the delay of 71days. Notably, while admitting the appeal, the Court had condoned thedelay in filing the appeal. However, at the final hearing of the appeal, anobjection regarding appeal being barred by limitation was allowed to beraised being jurisdictional issue and while dealing with the said objection,the Court referred to the decisions in Singh Enterprises vs.Commissioner of Central Excise, Jamshedpur & Ors.[14],Commissioner of Customs and Central Excise vs. Hongo IndiaPrivate Limited & Anr.[15], Chhattisgarh State Electricity Board vs.Central Electricity Regulatory Commission & Ors.[16]andSuryachakra Power Corporation Limited vs. Electricity Departmentrepresented by its Superintending Engineer, Port Blair & Ors.[17]and concluded that Section 5 of the Limitation Act, 1963 cannot be invokedby the Court for maintaining an appeal beyond maximum prescribedperiod in Section 125 of the Electricity Act.

13. The principle underlying the dictum in this decision would applyproprio vigore to Section 31 of the 2005 Act including to the powers ofthe High Court under Article 226 of the Constitution. Notably, in thisdecision, submission was canvassed by the assessee that in the peculiarfacts of that case (as urged in the present case), the Court may exerciseits jurisdiction under Article 142 of the Constitution, so that complete

13 (2017) 5 SCC 4214 (2008) 3 SCC 7015 (2009) 5 SCC 79116 (2010) 5 SCC 2317 (2016) 16 SCC 152

Ajustice can be done. This argument has been considered and plainlyrejected in the following words: -

“12. In A.R. Antulay v. R.S. Nayak, (1988) 2 SCC 602, whileexplicating and elaborating the principles under Article 142,Sabyasachi Mukharji, J. (as his Lordship then was) opined thus:(SCC p. 656, para 50)

“50. … The fact that the rule was discretionary did not alterthe position. Though Article 142(1) empowers the SupremeCourt to pass any order to do complete justice between theparties, the court cannot make an order inconsistent with thefundamental rights guaranteed by Part III of the Constitution.No question of inconsistency between Article 142(1) and Article32 arose. Gajendragadkar, J., speaking [Prem ChandGarg v. Excise Commr., AIR 1963 SC 996] for the majorityof the Judges of this Court said that Article 142(1) did notconfer any power on this Court to contravene the provisionsof Article 32 of the Constitution. Nor did Article 145 conferpower upon this Court to make rules, empowering it tocontravene the provisions of the fundamental right. At AIRpp. 1002-03, para 12 : SCR p. 899 of the Report,Gajendragadkar, J., reiterated that the powers of this Courtare no doubt very wide and they are intended and “will alwaysbe exercised in the interests of justice”. But that is not to saythat an order can be made by this Court which is inconsistentwith the fundamental rights guaranteed by Part III of theConstitution. It was emphasised that an order which this Courtcould make in order to do complete justice between theparties, must not only be consistent with the fundamentalrights guaranteed by the Constitution, but it cannot evenbe inconsistent with the substantive provisions of therelevant statutory laws. The court therefore, held that it wasnot possible to hold that Article 142(1) conferred upon thisCourt powers which could contravene the provisions of Article32.”

(emphasis in original)

13. The said decision has been clarified by Constitution Benchin Union Carbide Corpn. v. Union of India, (1991) 4 SCC 584,

wherein M. N. Venkatachaliah, J. (as his Lordship then was)speaking for the majority, ruled that: (SCC pp. 634-35, para 83)

“83. It is necessary to set at rest certain misconceptions in thearguments touching the scope of the powers of this Court underArticle 142(1) of the Constitution. These issues are matters ofserious public importance. The proposition that provision in anyordinary law irrespective of the importance of the public policy onwhich it is founded, operates to limit the powers of the Apex Courtunder Article 142(1) is unsound and erroneous. In both PremChand Garg v. Excise Commr., AIR 1963 SC 996, as well as A.R.Antulay v. R.S. Nayak, (1988) 2 SCC 602, cases the point wasone of violation of constitutional provisions and constitutional rights.The observations as to the effect of inconsistency with statutoryprovisions were really unnecessary in those cases as the decisionsin the ultimate analysis turned on the breach of constitutional rights.We agree with Shri Nariman that the power of the Court underArticle 142 insofar as quashing of criminal proceedings areconcerned is not exhausted by Section 320 or 321 or 482 CrPC orall of them put together. The power under Article 142 is at anentirely different level and of different quality. Prohibitions orlimitations or provisions contained in ordinary laws cannot, ipsofacto, act as prohibitions or limitations on the constitutional powersunder Article 142. Such prohibitions or limitations in the statutesmight embody and reflect the scheme of particular law, takinginto account the nature and status of the authority or the court onwhich conferment of powers — limited in some appropriate way— is contemplated. The limitations may not necessarily reflect orbe based on any fundamental considerations of public policy. ShriSorabjee, learned Attorney General, referring to Garg case [PremChand Garg v. Excise Commr., AIR 1963 SC 996], said thatlimitation on the powers under Article 142 arising from“inconsistency with express statutory provisions of substantive

law” must really mean and be understood as some expressprohibition contained in any substantive statutory law. He suggestedthat if the expression “prohibition” is read in place of “provision”that would perhaps convey the appropriate idea. But we thinkthat such prohibition should also be shown to be based onsome underlying fundamental and general issues of publicpolicy and not merely incidental to particular statutory

scheme or pattern. It will again be wholly incorrect to saythat powers under Article 142 are subject to such expressstatutory prohibitions. That would convey the idea thatstatutory provisions override constitutional provision.Perhaps, the proper way of expressing the idea is that inexercising powers under Article 142 and in assessing theneeds of “complete justice” of cause or matter, the ApexCourt will take note of the express prohibitions in anysubstantive statutory provision based on some fundamentalprinciples of public policy and regulate the exercise of itspower and discretion accordingly. The proposition does notrelate to the powers of the Court under Article 142, but only towhat is or is not “complete justice” of cause or matter and in theultimate analysis of the propriety of the exercise of the power. Noquestion of lack of jurisdiction or of nullity can arise.”

(emphasis in original)

14. In this regard, another Constitution Bench in Supreme CourtBar Assn. v. Union of India, (1998) 4 SCC 409] opined: (SCC pp. 437-38, para 56)

“56. As matter of fact, the observations on which emphasishas been placed by us from the Union Carbide case [UnionCarbide Corpn. v. Union of India, (1991) 4 SCC 584], A.R.Antulay case [A.R. Antulay v. R.S. Nayak, (1988) 2 SCC602] and Delhi Judicial Service Assn. v. State of Gujarat,(1991) 4 SCC 406, go to show that they do not strictlyspeaking come into any conflict with the observations ofthe majority made in Prem Chand Garg case [Prem ChandGarg v. Excise Commr., AIR 1963 SC 996]. It is one thing tosay that “prohibitions or limitations in statute” cannot comein the way of exercise of jurisdiction under Article 142 to docomplete justice between the parties in the pending “cause ormatter” arising out of that statute, but quite different thing tosay that while exercising jurisdiction under Article 142, thisCourt can altogether ignore the substantive provisions of astatute, dealing with the subject and pass orders concerningan issue which can be settled only through mechanismprescribed in another statute. This Court did not say so in UnionCarbide case [Union Carbide Corpn. v. Union of India,

(1991) 4 SCC 584] either expressly or by implication and onthe contrary it has been held that the Apex Court will takenote of the express provisions of any substantive statutorylaw and regulate the exercise of its power and discretionaccordingly. …”

(emphasis in original)

15. From the aforesaid decisions, it is clear as crystal that theConstitution Bench in Supreme Court Bar Assn. v. Union ofIndia, (1998) 4 SCC 409, has ruled that there is no conflict ofopinion in Antulay case [A.R. Antulay v. R.S. Nayak, (1988) 2SCC 602] or in Union Carbide Corpn. case [Union CarbideCorpn. v. Union of India, (1991) 4 SCC 584] with the principleset down in Prem Chand Garg v. Excise Commr., AIR 1963 SC996. Be it noted, when there is statutory command by thelegislation as regards limitation and there is the postulatethat delay can be condoned for further period notexceeding sixty days, needless to say, it is based on certainunderlined, fundamental, general issues of public policy ashas been held in Union Carbide Corpn. case [Union CarbideCorpn. v. Union of India, (1991) 4 SCC 584]. As thepronouncement in Chhattisgarh SEB v. Central ElectricityRegulatory Commission, (2010) 5 SCC 23, lays down quite clearlythat the policy behind the Act emphasising on the constitution of aspecial adjudicatory forum, is meant to expeditiously decide thegrievances of person who may be aggrieved by an order of theadjudicatory officer or by an appropriate Commission. The Act isa special legislation within the meaning of Section 29(2) of theLimitation Act and, therefore, the prescription with regard to thelimitation has to be the binding effect and the same has to befollowed regard being had to its mandatory nature. To put it in adifferent way, the prescription of limitation in case ofpresent nature, when the statute commands that this Courtmay condone the further delay not beyond 60 days, it wouldcome within the ambit and sweep of the provisions and policyof legislation. It is equivalent to Section 3 of the LimitationAct. Therefore, it is uncondonable and it cannot be condonedtaking recourse to Article 142 of the Constitution.

DEFG

A16. We had stated earlier that we will be adverting to the passagein Suryachakra Power Corpn. Ltd. v. Electricity Deptt., (2016)16 SCC 152. There, the Court had referred to Section 14 of theLimitation Act. It fundamentally relied on M.P. SteelCorpn. v. CCE, (2015) 7 SCC 58, wherein the Court after referringto certain authorities, analysed thus: (M.P. Steel Corpn. Case),BSCC p. 91, para 43)

“43. … when certain period is excluded by applying theprinciples contained in Section 14, there is no delay to beattributed to the appellant and the limitation period provided bythe statute concerned continues to be the stated period and notCmore than the stated period. We conclude, therefore, that theprinciple of Section 14 which is principle based on advancingthe cause of justice would certainly apply to exclude time takenin prosecuting proceedings which are bona fide and with duediligence pursued, which ultimately end without decision onDthe merits of the case.””

(emphasis in italics – in original, and in bold – supplied)

Similarly, in State vs. Mushtaq Ahmad & Ors.[18], this Court opinedthat where minimum sentence is provided for an offence then no Courtcan impose lesser punishment on ground of mitigating factors.

14. priori, we have no hesitation in taking the view that whatthis Court cannot do in exercise of its plenary powers under Article 142of the Constitution, it is unfathomable as to how the High Court can takea different approach in the matter in reference to Article 226 of theConstitution. The principle underlying the rejection of such argument byFthis Court would apply on all fours to the exercise of power by the HighCourt under Article 226 of the Constitution.

15. We may now revert to the Full Bench decision of the AndhraPradesh High Court in Electronics Corporation of India Ltd. (supra),which had adopted the view taken by the Full Bench of the Gujarat HighGCourt in Panoli Intermediate (India) Pvt. Ltd. vs. Union of India &Ors.[19] and also of the Karnataka High Court in Phoenix PlastsCompany vs. Commissioner of Central Excise (Appeal-I),Bangalore[20]. The logic applied in these decisions proceeds on fallacious

18 (2016) 1 SCC 315H19 AIR 2015 Guj 9720 2013 (298) ELT 481 (Kar.)

premise. For, these decisions are premised on the logic that provisionsuch as Section 31 of the 1995 Act, cannot curtail the jurisdiction of theHigh Court under Articles 226 and 227 of the Constitution. This approachis faulty. It is not matter of taking away the jurisdiction of the HighCourt. In given case, the assessee may approach the High Court beforethe statutory period of appeal expires to challenge the assessment orderby way of writ petition on the ground that the same is without jurisdictionor passed in excess of jurisdiction - by overstepping or crossing thelimits of jurisdiction including in flagrant disregard of law and rules ofprocedure or in violation of principles of natural justice, where noprocedure is specified. The High Court may accede to such challengeand can also non-suit the petitioner on the ground that alternativeefficacious remedy is available and that be invoked by the writ petitioner.However, if the writ petitioner choses to approach the High Court afterexpiry of the maximum limitation period of 60 days prescribed underSection 31 of the 2005 Act, the High Court cannot disregard the statutoryperiod for redressal of the grievance and entertain the writ petition ofsuch party as matter of course. Doing so would be in the teeth of theprinciple underlying the dictum of three-Judge Bench of this Court inOil and Natural Gas Corporation Limited (supra). In other words,the fact that the High Court has wide powers, does not mean that itwould issue writ which may be inconsistent with the legislative intentregarding the dispensation explicitly prescribed under Section 31 of the2005 Act. That would render the legislative scheme and intention behindthe stated provision otiose.

16. The respondent had relied on the decision of this Court in K.S.Rashid & Son vs. the Income Tax Investigation Commission[21]. Thisdecision of the Constitution Bench, no doubt, deals with the extent ofpower of the High Court under Article 226 of the Constitution and thesituation when the High Court can refuse to exercise its discretion, suchas when alternative efficacious remedy is available to the aggrievedparty. In paragraph 4 (last paragraph) of this decision, however, theCourt plainly noted that it was not necessary to express any final opinionon the question as to whether Section 8(5) of the Taxation on Income(Investigation Commission) Act, 1947 (Act XXX of 1947) is to beregarded as providing the only remedy available to the aggrieved partyand that it excludes altogether the remedy provided for under Article226 of the Constitution.

A17. Reliance was then placed on three-Judge Bench decision ofthis Court in ITC Ltd. & Anr. Vs. Union of India[22]. In that case, theHigh Court had dismissed the writ petition on the ground that the petitionertherein had an adequate alternative remedy by way of an appeal underSection 35 of the Central Excise Act. Concededly, this Court was pleasedto uphold that opinion of the High Court. However, whilst consideringBthe difficulty expressed by the petitioner therein that the statutory remedyof appeal had now become time barred during the pendency of theproceedings before the High Court and before this Court, the Courtpermitted the petitioner therein to resort to remedy of statutory appealand directed the appellate authority to decide the appeal on merits. ThisCobviously was done on the basis of concession given by the counselappearing for the Revenue as noted in paragraph 2(1) of the order, whichreads thus: -

“2. The High Court has dismissed the writ petition filed by thepetitioner on the ground that there is an adequate alternativeDremedy by way of an appeal under Section 35 of the CentralExcise Act. Learned counsel for the petitioner submits that thepetitioner will face certain difficulties in pursuing this remedy:

(1) This remedy may not be any longer available to it becausethe appeal has to be filed within period of three months fromEthe date of the assessment order and delay can be condonedonly to the extent of three more months by the Collector underSection 35 of the Act. It is pointed out that the petitioner didnot file an appeal because the Collector (Appeal) at Madrashad taken view in similar matter that an appeal was notmaintainable. That apart, the petitioner in view of the hugeFdemand involved filed writ petition and so did not file anappeal. In the circumstances of the case, we are of the opinionthat the ends of justice will be met if we permit the petitionerto file belated appeal within one month from today with anapplication for condonation of delay, whereon the appeal mayGbe entertained. Learned counsel for the Revenue hasstated before us that the Revenue will not object to theentertainment of the appeal on the ground that it isbarred by time. In view of this direction and concession,

the petitioner will have an effective alternative remedyby way of an appeal.

(emphasis supplied)

In that case, it appears that the writ petition was filed withinstatutory period and legal remedy was being pursued in good faith by theassessee (appellant).

18. Suffice it to observe that this decision is on the facts of thatcase and cannot be cited as precedent in support of an argument thatthe High Court is free to entertain the writ petition assailing the assessmentorder even if filed beyond the statutory period of maximum 60 days infiling appeal. The remedy of appeal is creature of statute. If the appealis presented by the assessee beyond the extended statutory limitationperiod of 60 days in terms of Section 31 of the 2005 Act and is, therefore,not entertained, it is incomprehensible as to how it would become caseof violation of fundamental right, much less statutory or legal right assuch.

19. Arguendo, reverting to the factual matrix of the present case,it is noticed that the respondent had asserted that it was not aware aboutthe passing of assessment order dated 21.6.2017 although it is admittedthat the same was served on the authorised representative of therespondent on 22.6.2017. The date on which the respondent becameaware about the order is not expressly stated either in the application forcondonation of delay filed before the appellate authority, the affidavitfiled in support of the said application or for that matter, in the memo ofwrit petition. On the other hand, it is seen that the amount equivalent to12.5% of the tax amount came to be deposited on 12.9.2017 for and onbehalf of respondent, without filing an appeal and without any demur -after the expiry of statutory period of maximum 60 days, prescribedunder Section 31 of the 2005 Act. Not only that, the respondent filed aformal application under Rule 60 of the 2005 Rules on 8.5.2018 andpursued the same in appeal, which was rejected on 17.8.2018.Furthermore, the appeal in question against the assessment order cameto be filed only on 24.9.2018 without disclosing the date on which therespondent in fact became aware about the existence of the assessmentorder dated 21.6.2017. On the other hand, in the affidavit of Mr. SreedharRouth, Site Director of the respondent company (filed in support of theapplication for condonation of delay before the appellate authority), it isstated that the company became aware about the irregularities committed

Aby its erring official (Mr. P. Sriram Murthy) in the month of July, 2018,which pre-supposes that the respondent must have become aware aboutthe assessment order, at least in July, 2018. In the same affidavit, it isasserted that the respondent company was not aware about theassessment order, as it was not brought to its notice by the employeeconcerned due to his negligence. The respondent in the writ petition hasBaverred that the appeal was rejected by the appellate authority on theground that it had no power to condone the delay beyond 30 days, whenin fact, the order examines the cause set out by the respondent andconcludes that the same was unsubstantiated by the respondent. Thatfinding has not been examined by the High Court in the impugnedCjudgment and order at all, but the High Court was more impressed bythe fact that the respondent was in position to offer some explanationabout the discrepancies in respect of the volume of turnover and that therespondent had already deposited 12.5% of the additional amount interms of the previous order passed by it. That reason can have no bearing

on the justification for non-filing of the appeal within the statutory period.DNotably, the respondent had relied on the affidavit of the Site Directorand no affidavit of the concerned employee (P. Sriram Murthy, DeputyManager-Finance) or at least the other employee [Siddhant Belgaonker,Senior Manager (Finance)], who was associated with the erring employeeduring the relevant period, has been filed in support of the stand taken inEthe application for condonation of delay. Pertinently, no finding has beenrecorded by the High Court that it was case of violation of principlesof natural justice or non-compliance of statutory requirements in anymanner. Be that as it may, since the statutory period specified for filingof appeal had expired long back in August, 2017 itself and the appealcame to be filed by the respondent only on 24.9.2018, withoutFsubstantiating the plea about inability to file appeal within the prescribedtime, no indulgence could be shown to the respondent at all.

20. Reverting to the contention that the respondent having failedto assail the order passed by the appellate authority, dated 25.10.2018rejecting the application for condonation of delay, the assessment orderGpassed by the Assistant Commissioner, dated 21.6.2017 stood merged,need not detain us in view of the exposition of this Court in RajaMechanical Company Private Limited vs. Commissioner of CentralExcise, Delhi-I[23]. It is well settled that rejection of delay application by

H23 (2012) 12 SCC 613

the appellate forum does not entail in merger of the assessment orderwith that order.

21. Taking any view of the matter, therefore, the High Court oughtnot to have entertained the subject writ petition filed by the respondentherein. The same deserved to be rejected at the threshold.

22. Accordingly, we allow this appeal and set aside the impugnedjudgment and order passed by the High Court and dismiss the writ petition.There shall be no order as to costs. Pending interlocutory applications, ifany, shall stand disposed of.

Kalpana K. Tripathy

Appeal allowed.