In a recent ruling, the High Court of Karnataka dismissed the writ petition and directed the petitioner to seek statutory remedy as provided under the law against the threatening action of the VAT officer.
In this case, the writ petitioner claims to be a registered partnership firm that operates a bar, restaurant, and lodging under the name M/s. Three 1st Enterprises on P.B. Road. Dharwad.
The firm is registered under the Karnataka Value Added Tax Act, 2003,(KVAT) the Central Sales Tax Act, 1956, and the Karnataka Tax on Entry of Goods Act, 1979.
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On 3-10-2013, the Commercial Tax Officer (VAT) with inspectors visited the petitioner’s place of business. When the officers claimed that they came for inspection of Trishul Bar and Restaurant as per the assignment of the Joint Commissioner of Commercial Taxes (Enforcement) Hubballi, the petitioner told them that the business location belongs to M/s. Three 1st Enterprises and not to Trishul Bar and Restaurant.
Although the true copy of the assignment was demanded by the petitioner, the officers did not provide a copy of the assignment and threatened the petitioner with criminal prosecution, and demanded the books of accounts. The petitioner provided the officers with the purchase bills, sales register, and sales bills voluntarily, which were properly available on the business premises.
The petitioner, who was aggrieved by the threatening action of the officers, filed a writ petition under Article 226 of the Constitution before the High Court of Karnataka.
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The bench observed that, M/s. Three 1st Enterprises and Trishul Bar and Restaurant are different entities, and thus the tax officers could not have made a sudden visit. The bench also observed that the disputed question of fact cannot be investigated in a proceeding under Article 226 of the Constitution of India.
The bench comprising of Justice Jyoti MulimanI held that the petitioner has an alternative efficacious statutory remedy under Section 62 of the KVAT Act, 2003. Thus, the bench dismissed the writ petition and directed the petitioner to seek statutory remedy as provided under the law.
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