Case: Titaghur Paper Mills Company Limited and Another Vs. State of Orissa and Others

it confirmed what ex facie was a nullity for reasons aforementioned.We find no justification for extending the principles laid down in Mohammad Nooh case, to a case like the present where there is an assessment made by the learned Sales Tax Officer under the Act. In Raleigh Investment Company case, the Privy Council rightly observed that the phrase "made under the Act" described the provenance of the assessment; it does not relate to its accuracy in point of law. The use of the machinery provided by the Act, not the result of that use, is the test.10. The decision in Mohammad Nooh case, is clearly distinguishable as in that case there was total lack of jurisdiction. There is no suggestion that the learned Sales Tax Officer had no jurisdiction to make an assessment. Nor can it be contended that he had acted in breach of rules of natural justice. There is no denying the fact that the petitioner was served with a notice of the proceedings under Rule 12 (5) of the Rules and sub-section (4) of Section 12 of the Act. The impugned orders clearly show that the petitioners were afforded sufficient opportunity to place their case. Merely because the learned Sales Tax Officer refused to grant any further adjournment and decided to proceed to best judgment, it cannot be said that he acted in violation of the rules of natural justice. The question whether another adjournment should have been granted or not was within the discretion of the learned Sales Tax Officer and is a matter which can properly be raised only in an appeal under sub-section (1) of Section 23 of the Act. All that this Court laid down in Mohammad Nooh case (1958 scr 595 : air 1958 SC 86 : 1958 SCJ 242 ), is that the rule which requires the exhaustion of alternative remedies is a rule of convenience and discretion rather than a rule of law; in other words, it does not bar the jurisdiction of the court.11. Under the scheme of the Act, there is a hierarchy of authorities before which the petitioners can get adequate redress against the wrongful acts complained of. The petitioners have the right to prefer an appeal before the Prescribed Authority under sub-section (1) of Section 23 of the Act. If the petitioners are dissatisfied with the decision in the appeal, they can prefer a further appeal to the Tribunal under sub-section (3) of Section 23 of the Act, and then ask for a case to be stated upon a question of law for the opinion of the High Court under Section 24 of the Act. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under Article 226 of the Constitution. It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of. This rules was stated with great clarity by Willes, J. in Wolverhampton New Waterworks Co. v. Hawkesford (1859) 6 CBNS 3336, 356 : 28 LJCP 242 : 141 ER 486 : 7 WR 464) in the following passage :There are three classes of cases in which a liability may be established founded upon statute.... But there is a third class, viz. where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it... the remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to.The rule laid down in this passage was approved by the House of Lords in Neville v. London, Express Newspapers Ltd.(1919 AC 368 : 1919 All ER Rep 61 : 88 LJKB 282 : 120 LT 299) and has been reaffirmed by the Privy Council in Attorney-General of Trinidad and Tobago v. Gordon Grant & Co. Ltd. (1935 AC 532 : 104 LJ PC 82 : 153 LT 441 (PC)) and Secretary of State v. Mask & Co. (AIR 1940 PC 105 : 67 IA 222 : 188 IC 231). It has also been held to be equally applicable to enforcement of rights, and has been followed by this Court throughout. The High Court was therefore justified in dismissing the writ petitions in limine.12. Furthermore, the Act provides for an adequate safeguard against an arbitrary or unjust assessment. The petitioners have a right to prefer an appeal under sub-section (1) of Section 23 of the Act subject to their payment of the admitted amount of tax as enjoined by the proviso thereto. As regards the disputed amount of tax, the petitioners have the remedy of applying for stay of recovery to the Commissioner of Sales Tax under clause (a) of the second proviso to sub-section (5) of Section 13 of the Act which runs :"Provided further that -(a) when the dealer or person, as the case may be, has presented an appeal under sub-section (1) of Section 23, the Commissioner may, on an application in that behalf filed by such dealer or person within thirty days from the date of receipt by him of the notice under sub-section (4), in his discretion, stay the recovery of the amount in respect of which such notice has been issued or any portion thereof, for such period and subject to such conditions as the Commissioner thinks fit;"13. The petitioners are at liberty to make an application for stay of the disputed amount and the Commissioner will decide whether or not there should be such stay on such terms and conditions as he thinks fit, looking to the nature of the demand raised in the facts and circumstances of the present case.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]10. The decision in Mohammad Nooh case, is clearly distinguishable as in that case there was total lack of jurisdiction. There is no suggestion that the learned Sales Tax Officer had no jurisdiction to make an assessment. Nor can it be contended that he had acted in breach of rules of natural justice. There is no denying the fact that the petitioner was served with a notice of the proceedings under Rule 12 (5) of the Rules and sub-section (4) of Section 12 of the Act. The impugned orders clearly show that the petitioners were afforded sufficient opportunity to place their case. Merely because the learned Sales Tax Officer refused to grant any further adjournment and decided to proceed to best judgment, it cannot be said that he acted in violation of the rules of natural justice. The question whether another adjournment should have been granted or not was within the discretion of the learned Sales Tax Officer and is a matter which can properly be raised only in an appeal under sub-section (1) of Section 23 of the Act. All that this Court laid down in Mohammad Nooh case (1958 scr 595   : air 1958 SC 86   : 1958 SCJ 242  ), is that the rule which requires the exhaustion of alternative remedies is a rule of convenience and discretion rather than a rule of law; in other words, it does not bar the jurisdiction of the court.11. Under the scheme of the Act, there is a hierarchy of authorities before which the petitioners can get adequate redress against the wrongful acts complained of. The petitioners have the right to prefer an appeal before the Prescribed Authority under sub-section (1) of Section 23 of the Act. If the petitioners are dissatisfied with the decision in the appeal, they can prefer a further appeal to the Tribunal under sub-section (3) of Section 23 of the Act, and then ask for a case to be stated upon a question of law for the opinion of the High Court under Section 24 of the Act. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under Article 226 of the Constitution. It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of. This rules was stated with great clarity by Willes, J. in Wolverhampton New Waterworks Co. v. Hawkesford (1859) 6 CBNS 3336, 356 : 28 LJCP 242 : 141 ER 486 : 7 WR 464) in the following passageare three classes of cases in which a liability may be established founded upon statute.... But there is a third class, viz. where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it... the remedy provided by the statute must be followed, and it is not competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adheredrule laid down in this passage was approved by the House of Lords in Neville v. London, Express Newspapers Ltd.(1919 AC 368 : 1919 All ER Rep 61 : 88 LJKB 282 : 120 LT 299) and has been reaffirmed by the Privy Council in Attorney-General of Trinidad and Tobago v. Gordon Grant & Co. Ltd. (1935 AC 532 : 104 LJ PC 82 : 153 LT 441 (PC)) and Secretary of State v. Mask & Co. (AIR 1940 PC 105   : 67 IA 222 : 188 IC 231). It has also been held to be equally applicable to enforcement of rights, and has been followed by this Court throughout. The High Court was therefore justified in dismissing the writ petitions in limine.12. Furthermore, the Act provides for an adequate safeguard against an arbitrary or unjust assessment. The petitioners have a right to prefer an appeal under sub-section (1) of Section 23 of the Act subject to their payment of the admitted amount of tax as enjoined by the proviso thereto. As regards the disputed amount of tax, the petitioners have the remedy of applying for stay of recovery to the Commissioner of Sales Tax under clause (a) of the second proviso to sub-section (5) of Section 13 of the Act which runsfurther that -(a) when the dealer or person, as the case may be, has presented an appeal under sub-section (1) of Section 23, the Commissioner may, on an application in that behalf filed by such dealer or person within thirty days from the date of receipt by him of the notice under sub-section (4), in his discretion, stay the recovery of the amount in respect of which such notice has been issued or any portion thereof, for such period and subject to such conditions as the Commissioner thinks fit;The petitioners are at liberty to make an application for stay of the disputed amount and the Commissioner will decide whether or not there should be such stay on such terms and conditions as he thinks fit, looking to the nature of the demand raised in the facts and circumstances of the present case.