C.C.T. ORISSA & ORS. versus INDIAN EXPLOSIVES LTD.

Citation: [2008] 3 S.C.R. 621 · Decided: 28-02-2008 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Case Partly allowed

Judgment (excerpt)

[2008] 3 S.C.R. 621 
_,. 
' 
C.C.T. ORISSA & ORS. 
A 
v. 
INDIAN EXPLOSIVES LTD. 
(Civil Appeal No. 5123 of 2005) 
FEBRUARY 28, 2008 
B 
(DR. ARIJIT PASAYAT, C.K. THAKKER AND 
LOKESHWAR SINGH PANTA, JJ.) 
Orissa Sa/es Tax Act, 1947; 5th Proviso to S.5(1) and 
Ss. 11, 23(4)(a)/Orissa Sales Tax rules, 1947; r. 80 and Entry c 
48 of Notification issued uls.5(1)of 1947 Act: 
Sa/es Tax - Assessee filing return declaring certain 
goods purchased for manufacture of other goods paying sales 
tax @ 4% on value of such goods in terms of Entry 48 of a 
Notification - Accepted by assessing authority -
Re-
D 
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assessment - Issuance of show-cause Notice - Challenge to 
- Allowed by High Court - Correctness of - Held: Incorrect -
High Court failed to take into notice the parameters highlighted 
by Supreme Court relating to exhaustion of alternative remedy 
as laid down in the case of IC/ India Ltd. vs. State of Orissa -
E 
Hence, judgment of the High Court indefensible - Thus, set 
aside - Assessee directed to file response to the show-cause 
Notice and authorities to dispose of the proceedings in 
,... 
accordance with law - Judicial discipline - Adhering to. 
Respondent-assessee, a registered dealer under the F 
Orissa Sales Tax Act, filed a consolidated return in terms 
of s.11 of the Act claiming that the goods purchased by it 
as specified in the Certificate of Registration being used 
· in the manufacture of goods for sale. The assessee 
furnishing declaration to that effect in Form IV to the Seller G 
of such goods and making payment of sales tax @ 4% 
... 
on the value of such goods in terms of Entry 48 of the· 
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Notification issued by the authorities u/s. 5(1) of the Act. 
The claim was accepted by the authorities. Later, the 
621 
H 
a 
622 
SUPREME COURT REPORTS 
[2008] 3 S.C.R. 
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\.-. 
A authorities re-assessed the liability of the assesse'e and 
issued a show-cause notice, which was challenged by 
the assessee by filing a writ petition. The High Court 
allowed the petition by quashing the show-cause notice. 
Hence the present appeal. 
B 
Appellant contended that the High Court ought not 
to have entertained the writ petition more particularly 
when it had reject~d the stand of the assessee for the 
assessment year 1997-98 and 1998-99. But the High Court 
did not even refer to the said decision in the instant case. 
c 
Partly allowing the appeal, the Court 
HELD: 1.1 The High Court seems to have completely 
lost sight of the parameters highlighted by this Court in a 
large number of cases relating to exhaustion of alternative 
D remedy. Additionally the High Court did not even refer to 
the judgment of another Division Bench for the 
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assessment years 1997-98 and Assessment years 1998-
99 in the decided case of ICI India Ltd.* In any event, the 
High Court ought to have referred to the ratio of the 
E decision in the said case. That judicial discipline has 
not been adhered to. Looked at from any angle, the 
High Court's judgment is indefensible and is set aside. 
(Para - 7) [625-A, BJ 
*IC/ India Ltd. vs. State of Orissa (2007)) 10 SCR 433 -
F relied on. 
1.2 The respondent-assessee shall file its response, 
if any, to the show cause notice dated 14.1.2004. The 
Commissioner shall consider the reply to the show cause 
G notice filed, if any, and dispose of the proceeding in 
accordance with law. (Para - 8) [625-C, DJ 
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 5123 
.... 
of 2005. 
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From the final Order/Judgment dated 7.1.2005 of the High · 
C.C.T. ORISSA & ORS. v. INDIAN EXPLOSIVES L TO. 
623 
[PASAYAT, J.] 
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Court of Orissa at Cuttack in W. P. (C) No. 1931 /2004 
A 
Kirti Renu Mishra for the Appellants. 
G. Ramakrishna Prasad for the Respondent. 
The Judgment of the Court was delivered by 
B 
Dr. ARIJIT PASAYAT, J. 1. Challenge in this appeal is to 
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the judgment of a Division Bench of the Orissa High Court 
allowing the writ petition filed by the respondent (hereinafter 
referred to as the 'assessee'). 
2. Background facts in a nutshell are as follows: 
c 
The assessee is registered as a dealer under the Orissa 
Sales Tax, Act, 1947 (in short the 'Act') and the Orissa Sales 
Tax Rules, 1947 (in short the 'Rules'). For the assessment year, 
2000-2001 the assessee filed consolidated return under Section D 
) -
11 of the Act before the Assistant Commissioner of Sales Tax, 
Sundergarh Range, Rourkela (Assessment). In the said return 
the assessee claimed that it had purchased goods including

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