Polygems Vs. The Assistant Commissioner (ST)

In this batch of writ petitions, the petitioners, who are dealers under the provisions of the Tamil Nadu Goods and Service Tax Act, 2017 (TNGST Act), seek the quashing of orders that reverse the transitioning of tax deducted at source (TDS) under Section 140(1) of the Act. This issue is not new to the Court, as it has been addressed in a previous batch of writ petitions. On February 26, 2021, in W.P.No.2738 of 2020 and its batch, the Court decided in favor of the assessees on the same matter. Following this decision, the Revenue filed eight applications seeking a review of the order dated February 26, 2021, despite the batch comprising 23 writ petitions. The Court first addressed these review applications, hearing submissions from Mr. Haja Nazirudeen, learned Additional Advocate General for Mr. M. Venkateswaran, learned Special Government Pleader for the review petitioners, and Mr. Sujit Ghosh, representing Mr. Adithya Reddy, Mr. P. Rajkumar, Mr. N. Murali, Mr. T. Ramesh, Ms. Radhika Chandrasekar, Mr. R. Senniappan, and Mr. S. Rajesh, learned counsel for the respondents.

The scope of interference under Order XLVII Rule 1 of the Civil Procedure Code (CPC) is limited to cases where an apparent error in the order sought to be reviewed is evident. This error must be significant, characterized by either a grave omission or a misappreciation of the actual position, leading to a flawed exposition of the law. The Hon’ble Supreme Court, in S. Madhusudhan Reddy Vs. V. Narayana Reddy and others, has reiterated the stringent conditions under which a review can be considered under the CPC. In paragraphs 16 and 17 of this judgment, the Supreme Court emphasized that such a prayer for review must strictly conform to the scope and ambit of Order XLVII Rule 1 of the CPC.

The petitioners’ grievances revolve around the procedural and legal challenges in reversing TDS transitions under Section 140(1) of the TNGST Act. The earlier decision by this Court in favor of the assessees has set a precedent that the Revenue is now attempting to challenge through its review applications. The Court’s adherence to the stringent standards for review under the CPC ensures that only clear and significant errors warranting reconsideration are addressed. This approach upholds the integrity of judicial decisions and provides a clear framework for legal recourse and review. The ongoing review applications and the associated legal arguments underscore the complexity of transitioning tax credits under the evolving GST regime, reflecting broader challenges faced by taxpayers and the administration in implementing and interpreting GST laws.

The principles for exercising review jurisdiction, as established in the case of Kamlesh Verma Vs. Mayawati, provide a detailed framework for understanding when a review is maintainable and when it is not. Review is maintainable under specific conditions as stipulated by the statute, ensuring that the review process is not misused and remains a tool for correcting genuine errors or addressing new evidence. Firstly, a review is permissible upon the discovery of new and important matter or evidence. This applies when significant evidence is discovered that, despite due diligence, was not within the knowledge of the petitioner or could not be produced by them at the time of the original hearing. This ground acknowledges that crucial information may only come to light after the original judgment has been passed, potentially altering the case outcome. Secondly, a review can be sought in cases of mistake or error apparent on the face of the record. This refers to an obvious error that is immediately evident and does not require extensive analysis or argument to uncover. Such an error must strike at the very soundness of the decision and be clear and self-evident from the record itself. Thirdly, any other sufficient reason provides a flexible criterion, allowing for review in situations analogous to those specified in the rule. The phrase “any other sufficient reason” has been interpreted in Chajju Ram v. Neki and approved by the Supreme Court in Moran Mar Basselios Catholicos v. Most Rev. Mar Poulose Athanasius to mean a reason sufficient on grounds similar to those specified in the rule. This interpretation offers the courts some discretion to consider unique and compelling reasons for review that may not fall strictly under the first two categories but are nonetheless significant enough to warrant reconsideration. These principles were reiterated in Union of India v. Sandur Manganese & Iron Ores Ltd., reinforcing their validity and application in subsequent cases.

Conversely, the guidelines clarify that review will not be maintainable under certain circumstances to prevent misuse of the review process. A review will not be entertained for the repetition of old and overruled arguments. Simply repeating arguments that have already been considered and rejected by the court is insufficient to reopen a concluded adjudication. Review is also not meant for minor mistakes of inconsequential import. The process is not designed to address trivial errors that do not affect the overall judgment. Moreover, review proceedings cannot be equated with the original hearing of the case. Review is not an appeal in disguise; it does not provide a second chance to argue the same case on different grounds. A review is not maintainable unless the material error is manifest on the face of the order, undermining its soundness or resulting in a miscarriage of justice. Furthermore, the mere possibility of two views on the subject cannot be a ground for review. The error apparent on the face of the record should not be one that has to be fished out and searched; it must be immediately evident. These stringent conditions ensure that review remains a mechanism for rectifying substantial and obvious errors or addressing genuinely new and important evidence, rather than a tool for re-litigating cases or delaying justice.

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