IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 30.9.2011 CORAM THE HON'BLE MR.JUSTICE M.JAICHANDREN Writ Petition No.20000 of 2010 M/s.Calpana Service Station Rep. by its Proprietor K.Deivanayagam R.S.No.145/5, Villianur Road Kurumbapet Revenue Village Sulthanpet,Puducherry – 605 004 … petitioner Vs. The Deputy Commercial Tax Officer (Registration Cell) Commercial Taxes Department, Office of the Commissioner (CT), Puducherry … Respondent Writ Petition filed under Article 226 of the Constitution of India praying for a writ of Certiorari to call for the records relating to the proceedings of the respondent No.800/DCTO/(RC)/2009- 10 dated 27.8.2010, and quash the same. For petitioner : Mr.R.Mahadevan For Respondent : Mr.T.P.Manoharan Special Government Pleader O R D E R This writ petition has been filed by the petitioner praying that this Court may be pleased to issue a writ of Certiorari to call for and quash the impugned proceedings of the respondent, dated 27.8.2010. 2. It has been stated that the petitioner, who is a physically handicapped person, is the proprietor of M/s.Calpana Service Station, Puducherry, which deals with petroleum products, based on the dealership granted to it by the Indian Oil Corporation. 3. It has been further stated that the petitioner had been granted registration certificate, under the erstwhile Pondicherry General Sales Tax Act, 1967, as well as under the present Puducherry Value Added Tax Act, 2007, and the Central Sales Tax Act, 1956, for https://hcservices.ecourts.gov.in/hcservices/ the resale of the petroleum products. Based on the registration certificate issued in favour of the petitioner, it has been running a petroleum bunk and reselling the petroleum products in Puducherry. The petitioner, as the registered dealer of the petroleum products, has been acting as an agent of the Government by collecting the tax from the Consumer public on the price of the petroleum products. It has been filing the returns and remitting the tax collected by it, before the assessing authority concerned, regularly. While so, certain discrepancies had been found in the orders of assessment for the assessment years 2004-05 to 2006-07. 4. It has been stated in the said assessment orders that there were certain differences noted in the turnover reported in the petitioner’s returns and in the supply vouchers provided by the Indian Oil Corporation. Further, with regard to the sale of lubricants, the second sale of such lubricants had been treated as first sale, by the authorities concerned. In such circumstances, the petitioner had challenged the said orders before the appellate authority concerned. It had been further stated that the returns filed by the petitioner are correct and the entire admitted tax has been paid. 5. It had been stated that the sale of lubricants should be treated only as second sale, as they had been purchased only from the customers' outlet. However, before the assessment orders had become final, as the appeals filed by the petitioner were pending adjudication, the respondent had cancelled the registration of the petitioner, by his order, No.800/DCTO/(RC)/2009-10, dated 9.11.2009. The said order had been passed without providing sufficient time to the petitioner to submit its objections. Pursuant to the order passed by the respondent, canceling the registration of the petitioner, the Indian Oil Corporation had refused to supply fuel to the petitioner bunk. In such circumstances, the petitioner had filed a writ petition before this Court, in W.P.No.24605 of 2009, challenging the order of the respondent. 6. This Court had allowed the writ petition, by its order, dated 23.12.2009, and had directed the respondent to pass appropriate orders, after giving an opportunity to the petitioner to submit its reply. Accordingly, the petitioner had submitted its reply, on 31.12.2009. The respondent had issued a notice, dated 27.1.2010, calling for the objections of the petitioner. The petitioner has submitted its reply, dated 11.12.2010, stating that the appeals filed by the petitioner, against the assessment orders, were still pending and the orders passed by the respondent had not attained finality. Therefore, the registration of the petitioner cannot be cancelled on the ground of arrears of tax. However, the respondent, without considering the objections raised by the petitioner, had passed an order, dated 23.2.2010, canceling the registration of the petitioner. https://hcservices.ecourts.gov.in/hcservices/ 7. It had been further stated that the petitioner had challenged the order of the respondent, dated 23.2.2010, by way of a writ petition, filed before this Court, in W.P.No.3904 of 2010. By an order, dated 24.2.2010, this Court had granted an order of interim stay of the impugned order of the respondent, in M.P.No.1 of 2010. Thereafter, the interim order granted by this Court, on 24.2.2010, had been further extended. While so, the petitioner had submitted an application for renewal of the registration, along with the necessary fee for such renewal. Based on the application filed by the petitioner, the respondent had renewed the registration of the petitioner in the month of June, 2010, thereby, impliedly revoking the cancellation of the registration of the petitioner. Thereafter, the petitioner had been granted renewal of the registration, for the year 2010-2011, on 27.6.2010, by the Deputy Commercial Tax Officer, Puducherry. In such circumstances, the petitioner had submitted before this Court that, in view of the renewal of the registration of the petitioner, by the respondent, the writ petition, in W.P.No.3904 of 2010, has become infructuous. Recording the submissions, made on behalf of the petitioner, this Court, by an order, dated 14.7.2010, had dismissed the writ petition, in W.P.No.3904 of 2010, as infructuous. Consequently, the connected miscellaneous petition, in M.P.No.1 of 2010, had been closed. Accordingly, this Court had passed the order, on 14.7.2010, dismissing the writ petition, in W.P.No.3904 of 2010, as infructuous. 8. After the dismissal of the writ petition by this Court, the respondent, by its order, dated 27.8.2010, had stated that the petitioner cannot claim itself as a registered dealer, under the provisions of the Puducherry Value Added Tax Act, 2007, and the Central Sales Tax Act, 1956, and thereby, carry on the resale of the petroleum products in the union territory of Pudhucherry. He had stated in the said impugned order that the earlier order, dated 23.2.2010, cancelling the registration certificate granted in favour of the petitioner is in operation, in view of the dismissal of the writ petition, in W.P.No.3904 of 2010. Therefore, the petitioner had preferred the present writ petition challenging the order of the respondent, dated 27.8.2010. 9. The learned counsel appearing on behalf of the petitioner had submitted that the impugned order of the respondent, dated 27.8.2010, is arbitrary, illegal and void. He had submitted that the impugned order of the respondent is in violation of the principles of natural justice. The respondent had not issued any notice to the petitioner before passing the said order. No opportunity of personal hearing had been given before the impugned order had been passed. 10. He had submitted that the renewal of the registration certificate of the petitioner amounts to an automatic revocation of https://hcservices.ecourts.gov.in/hcservices/ the order, dated 23.2.2010. Since, the registration certificate is valid only for a year, any renewal of the registration certificate would be like a fresh grant of registration certificate. In fact, the registration certificate granted in favour of the petitioner was valid, only from 27.6.2010 to 26.6.2011. Thereafter, when the petitioner had applied for a further renewal of the registration certificate, the respondent had passed the impugned order, dated 27.8.2010, stating that the request of the petitioner for the renewal of the registration cannot be granted, as the earlier order, dated 23.2.2010, cancelling the registration certificate granted in favour of the petitioner is in operation. 11. The learned counsel appearing on behalf of the petitioner had further submitted that the assessment order in question had not attained finality and therefore, there was no necessity to cancel the registration granted in favour of the petitioner. The only reason for the cancellation of the registration is that the petitioner is allegedly in arrears, with regard to the payment of tax. The submissions made on behalf of the respondent that no appeals are pending, challenging the assessment order passed against the petitioner, is false. The respondent does not have the jurisdiction to decide about the alleged arrears of tax. He cannot act as an assessing authority. Even if there are some arrears in the payment of tax, by the petitioner, it is open to the authority concerned to initiate appropriate action against the petitioner for the recovery of the same. However, the respondent does not have the power to stop the petitioner from carrying on its business. The respondent cannot claim that the writ petition is not maintainable due to the availability of an alternative remedy, under Section 45 of the Puducherry Value Added Tax Act, 2007, to the petitioner, as the impugned order passed by the respondent is contrary to the principles of natural justice and the relevant provisions of law. The impugned order of the respondent is infringing the provisions contained in Articles 19, 21, 265 and 300 of the Constitution of India. The respondent cannot curb the business activities of the petitioner for non-payment of the disputed tax, especially, when the petitioner had paid huge sums of money as the admitted tax. 12. The learned counsel appearing on behalf of the petitioner had also submitted that certain other similarly placed persons, as that of the petitioner, have been permitted to pay the arrears of tax in installments and they have been permitted to run their business without any impediment. 13. The learned counsel appearing on behalf of the petitioner had also submitted that the respondent had not stated the actual quantum of the arrears of tax due to be paid by the petitioner. Further, it is not open to the respondent to state in his impugned order, dated 27.8.2010, that the registration of the petitioner stands cancelled, both under the Central Sales Tax Act, 1956, as https://hcservices.ecourts.gov.in/hcservices/ well as the Puducherry Value Added Tax Act, 2007. According to Rule 9 (1) of the Central Sales Tax (Registration and Turnover) Rules, 1957, the notified authority shall provide to the dealer the opportunity of being heard before amending or cancelling the certificate of registration. However, in the present case, the respondent had cancelled the registration of the petitioner, by way of the impugned order, dated 27.8.2010, without giving an opportunity of personal hearing to the petitioner. Hence, the impugned order of the respondent, dated 27.8.2010, is invalid in the eye of law. 14. The learned counsel appearing on behalf of the petitioner had relied on the decisions in KALRA GLUE FACGTORY Vs. SALES TAX TRIBUNAL (1987) 066 STC 0292 and V.K.BATCHA MOHIDEEN Vs. JOINT COMMERCIAL TAX OFFICER, TIRUCHIRAPALLI TOWN-1 (1971) 028 STC 0450 in support of his contentions that this Court would have jurisdiction to set aside an order passed by the respondent even if an alternative remedy is available to the petitioner, under Section 45 of the Puducherry Value Added Tax Act, 2007, in case the impugned order results in violation of the principles of natural justice, especially, when it infringes the fundamental rights of the petitioner to carry on its trade, occupation or business. 15. Per contra, the learned Special Government Pleader appearing on behalf of the respondent had submitted that the petitioner cannot ask for the renewal of registration in its favour, as a matter of right. As the petitioner is in heavy amount of arrears of tax, the registration certificate of the petitioner had been cancelled. 16. He had further submitted that the petitioner had obtained an order of interim stay of the order passed by the respondent, on 23.2.2010, cancelling the registration certificate of the petitioner, in M.P.No.1 of 2010, W.P.No.3904 of 2010. In view of the pendency of the said writ petition and in view of the order of interim stay granted by this Court, the respondent had renewed the registration of the petitioner for the year 2010-2011, on 27.6.2010. Subsequently, for reasons best known to the petitioner the writ petition, in W.P.No.3904 of 2010, it had been submitted before this Court that the writ petition has become infructuous. In view of the submissions made by the learned counsel appearing on behalf of the petitioner, this court had dismissed the writ petition, as infructuous, by its order, dated 14.7.2010. Consequently, the connected miscellaneous petition had also been closed. Thereafter, the petitioner had made a request for the renewal of its registration, for the year 2011-2012. In such circumstances, the respondent had issued the order, dated 27.8.2010, stating that the earlier order, dated 23.2.2010, cancelling the registration certificate granted in favour of the petitioner is in operation. Hence, the petitioner cannot claim itself to be a registered dealer https://hcservices.ecourts.gov.in/hcservices/ under the provisions of the Puducherry Value Added Tax Act, 2007, and the Central Sales Tax Act, 1956. Therefore, the request of the petitioner for renewal of the registration cannot be granted. The said order, being a mere intimation of a prevailing factual position, with regard to the registration of the petitioner, cannot give right to a cause of action to the petitioner to challenge the same. 17. The learned Special Government Pleader appearing on behalf of the respondent had also submitted that the petitioner, by evading payment of tax, had misappropriated large sums of public money. Therefore, no sympathy can be shown by this Court in favour of the petitioner. The renewal granted in favour of the petitioner, for the year 2010-2011, can only be in respect of the Puducherry Value Added Tax Act, 2007, and therefore, there cannot be a renewal under the Pondicherry General Sales Tax Act, 1967. In view of the dismissal of the writ petition filed by the petitioner, in W.P.No.3904 of 2010, by an order, dated 14.7.2010, stating that the writ petition was dismissed, as infructuous, the interim renewal granted in favour of the petitioner is a nullity. As such, the earlier order passed by the respondent, on 23.2.2010, cancelling the registration of the petitioner would revive, automatically. No fresh cause of action would arise due to the order passed by the respondent, on 27.8.2010, since, it is only a reiteration of the existing legal situation. 18. He had also submitted that no renewal of registration could have been validly granted in favour of the petitioner, as per Rule 8 of the Puducherry Value Added Tax Act, 2007, in view of the pendency of the writ petition, in W.P.No.3904 of 2010. However, on the dismissal of the said writ petition, the registration granted in favour of the petitioner stood cancelled. As such, the writ petition filed by the petitioner is devoid of merits and therefore, it is liable to be dismissed with costs. 19. The learned Special Government Pleader appearing on behalf of the respondent had relied on the following decisions in support of his contentions: 19.1. In GANGABAI GOPALDAS MOHATA Vs. FULCHAND (1997) 10 SCC 386, the Supreme Court had held as follows: "In view of the fact that the appellant's service was terminated after an enquiry in which the appellant chose not to participate, we are of the view that the appellant cannot assail his termination on merits, even assuming that the writ petition filed by him in the High Court was maintainable. For this reason, it is not necessary to examine the correctness of the High Court's view that the writ petition was not maintainable. The dismissal of the appeal by this Court, is, therefore, not https://hcservices.ecourts.gov.in/hcservices/ to be construed as an expression of any opinion on the merits of the view taken by the High Court on the question of maintainability of the writ petition." 19.2. In SHIV KUMAR SHARMA Vs. SANTOSH KUMARI (2007) 8 SCC 600), the Supreme Court had held as follows: "26. In England, the court of equity exercises jurisdiction in equity. The courts of India do not possess any such exclusive jurisdiction. The courts in India exercise jurisdiction both in equity as well as law but exercise of equity jurisdiction is always subject to the provisions of law. If exercise of equity jurisdiction would violate the express provisions contained in law, the same cannot be done. Equity jurisdiction can be exercised only when no law operates in the field. 27. A court of law cannot exercise its discretionary jurisdiction dehors the statutory law. Its discretion must be exercised in terms of the existing statute. 28. In Shamsu Suhara Beevi v. G. Alex (2004) 8 SCC 569) this Court, while dealing with a matter relating to grant of compensation by the High Court under Section 21 of the Specific Relief Act in addition to the relief of specific performance in the absence of prayer made to that effect, either in the plaint or amending the same at any later stage of the proceedings to include the relief of compensation in addition to the relief of specific performance, observed: (SCC p. 576, para 11) “11. … Grant of such a relief in the teeth of express provisions of the statute to the contrary is not permissible. On equitable considerations court cannot ignore or overlook the provisions of the statute. Equity must yield to law" 19.3. In LIC Vs. ASHA RAMCHHANDRA AMBEKAR (1994) 2 SCC 718), the Supreme Court had held as follows: 11. At this juncture we may usefully refer to Martin Burn Ltd. v. Corporation of Calcutta (AIR 1966 SC 529). At page 535 of the Report the following observations are found: “A result flowing from a statutory provision is never an evil. A Court has no power to ignore that provision to relieve what it considers a distress resulting from its operation. A statute must of course be given effect to whether a Court likes the result or not.” https://hcservices.ecourts.gov.in/hcservices/ The courts should endeavour to find out whether a particular case in which sympathetic considerations are to be weighed falls within the scope of law. Disregardful of law, however, hard the case may be, it should never be done. In the very case itself, there are regulations and instructions which we have extracted above. The court below has not even examined whether a case falls within the scope of these statutory provisions. Clause 2 of sub-clause (iii) of Instructions makes it clear that relaxation could be given only when none of the members of the family is gainfully employed. Clause 4 of the circular dated January 20, 1987 interdicts such an appointment on compassionate grounds. The appellant Corporation being a statutory Corporation is bound by the Life Insurance Corporation Act as well as the Statutory Regulations and Instructions. They cannot be put aside and compassionate appointment be ordered." 19.4. In PRESTIGE LIGHTS LTD Vs. STATE BANK OF INDIA (2007) 8 SCC 449, the Supreme Court had held as follows: 33. It is thus clear that though the appellant Company had approached the High Court under Article 226 of the Constitution, it had not candidly stated all the facts to the Court. The High Court is exercising discretionary and extraordinary jurisdiction under Article 226 of the Constitution. Over and above, a court of law is also a court of equity. It is, therefore, of utmost necessity that when a party approaches a High Court, he must place all the facts before the Court without any reservation. If there is suppression of material facts on the part of the applicant or twisted facts have been placed before the Court, the writ court may refuse to entertain the petition and dismiss it without entering into merits of the matter. 35. It is well settled that a prerogative remedy is not a matter of course. In exercising extraordinary power, therefore, a writ court will indeed bear in mind the conduct of the party who is invoking such jurisdiction. If the applicant does not disclose full facts or suppresses relevant materials or is otherwise guilty of misleading the court, the court may dismiss the action without adjudicating the matter. The rule has been evolved in larger public interest to deter unscrupulous litigants from abusing the process of court by deceiving it. The very basis of the writ jurisdiction rests in disclosure of true, complete and correct facts. If the material facts are not candidly stated or are suppressed or are distorted, the very functioning of the writ courts would https://hcservices.ecourts.gov.in/hcservices/ become impossible." 19.5. In PEPSU RTC Vs. RAWEL SINGH (2008) 4 SCC 42, the Supreme Court had held as follows: "15. With regard to supply of documents, record reveals that the documents had been supplied to the workman and the said fact had been admitted by him. His case, however, was that due to heavy rain, all the documents were destroyed which necessitated supply of fresh documents. But as observed by the enquiry officer, the workman was asked as to whether he required any document but the workman replied in the negative. In our opinion, he could have continued to appear before the enquiry officer, got the documents, if he wanted, and participated in the enquiry. He, however, deliberately did not do so. It is alleged by the Corporation that the respondent intentionally remained absent as he was working with private bus operators and wanted to take a chance if enquiry proceedings are quashed and set aside on the plea of violation of principles of natural justice. We are not entering into correctness or otherwise of the allegations of the Corporation. One thing, however, is certain that in spite of service of show-cause notice, the respondent failed to appear at the enquiry and the enquiry officer had to proceed with the enquiry in absence of the respondent. 16. Apart from that it is also clear from the record that so far as the charge as to unauthorised absence of the respondent is concerned, the same is duly established from the record. The enquiry officer, in our opinion, rightly observed that Charges (ii) and (iii) were consequential in nature and based on Charge (i) and hence all the charges can be said to have been proved against the respondent. In our judgment, the Labour Court was wholly wrong in holding that enquiry was not fair. To us, it is not a case of not extending an opportunity to the employee but not availing of opportunity by the employee. Therefore, the finding recorded by the Labour Court that the enquiry was vitiated being violative of natural justice and fair play is based on “no evidence” and must be set aside." 19.6. In H.P.TRANSPORT CORPN Vs. K.C.RAHI (2008) 11 SCC 502, the Supreme Court had held as follows: "8. In the instant case we have been taken through various documents and also from the representation dated 19-10-1993 filed by the respondent himself it would https://hcservices.ecourts.gov.in/hcservices/ clearly show that he knew that a departmental enquiry was initiated against him yet he chose not to participate in the enquiry proceedings at his own risk. In such event plea of principle of natural justice is deemed to have been waived and he is estopped from raising the question of non-compliance with principles of natural justice. In the representation submitted by him on 19-10-1993 the subject itself reads “DEPARTMENTAL ENQUIRIES”. It is stated at the Bar that the respondent is a law graduate, therefore, he cannot take a plea of ignorance of law. Ignorance of law is no excuse much less by a person who is a law graduate himself." 19.7. In COMMR. OF CUSTOMS & CENTRAL EXCISE Vs. HONGO INDIA (P) LTD., (2009) 5 SCC 791, the Supreme Court had held as follows: "30. In the earlier part of our order, we have adverted to Chapter VI-A of the Act which provides for appeals and revisions to various authorities. Though Parliament has specifically provided an additional period of 30 days in the case of appeal to the Commissioner, it is silent about the number of days if there is sufficient cause in the case of an appeal to the Appellate Tribunal. Also an additional period of 90 days in the case of revision by the Central Government has been provided. However, in the case of an appeal to the High Court under Section 35-G and reference application to the