Summary
The Court restored a sugar company’s writ challenge to electricity duty and penalty on surplus power supplied to the Electricity Board. The dispute concerned statutory charging power and legislative competence on admitted transactions, rather than calculation or contested facts. An alternative statutory appeal did not justify refusing writ consideration of those jurisdictional legal questions. The tax and return-filing issues were remitted for fresh evaluation, with the merits of both sides’ arguments expressly left open.
Issues
- Whether the statutory appeal remedy justified declining the writ petition challenging authority to impose electricity duty.
- Whether the controversy required disputed factual findings or presented legal questions on admitted transactions.
Provisions considered
- Article 226, Constitution of IndiaAlternative remedy is a discretionary restraint, not an absolute jurisdictional bar. The petition raised legal questions concerning taxing jurisdiction and legislative competence that could be decided without resolving disputed facts. (¶¶ 19, 20, 21, 22, 23, 24, 25)
Held
- A High Court ordinarily defers to an effective statutory remedy, but exceptions include enforcement of fundamental rights, breach of natural justice, proceedings wholly without jurisdiction and challenges to legislative validity. The exhaustion rule remains one of policy, convenience and discretion. (¶¶ 19, 20, 21)
- The company disputed the State’s authority to tax its sale to the Electricity Board, rather than the numerical calculation of duty and penalty. The nature of the supply was undisputed. Whether the charging provision and constitutional allocation of taxing power encompassed it presented legal questions suitable for writ adjudication. (¶¶ 18, 22, 23, 24)
- The return-filing question depended on whether the supply fell within the charging provision. The High Court wrongly treated the case as requiring factual inquiry and rejected it solely in favour of the statutory remedy. Differences between a sugar mill generating surplus power and another electricity generator did not create the supposed factual dispute. (¶¶ 12, 14, 23, 24, 25)
- The writ petition was restored for fresh determination. The Court recorded the parties’ substantive tax arguments only to assist remand and expressly left them open; it did not decide whether duty was payable. The cause-title amendment following merger was allowed. (¶¶ 25, 26, 27)
Result
Appeal allowed without costs. High Court judgment set aside and writ petition restored for fresh determination; substantive tax issues left open. Cause-title amendment allowed.