1993 (11) TMI 227 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Violation of natural justice.
2. Adequacy of opportunity to file objections.
3. Availability and furnishing of documents.
4. Legitimacy of the impugned order.

Detailed Analysis:

1. Violation of Natural Justice:
The petitioner contended that the impugned order was passed in violation of the rules of natural justice, specifically the principle of audi alteram partem. The petitioner argued that it was not given an adequate opportunity to file objections to the proposed tax liability because the necessary documents were not provided by the respondent. The court agreed, noting that the sequence of events demonstrated that the petitioner was led to believe it would be given an opportunity to file objections after receiving the requested documents. The court held that the impugned order was passed without observing the rules of natural justice, rendering it void.

2. Adequacy of Opportunity to File Objections:
The court found that the petitioner was deprived of a valuable opportunity to project its points of view effectively. The petitioner had repeatedly requested copies of the debit notes, which were crucial for filing objections. The absence of any indication from the department that these documents would not be furnished led to a legitimate expectation that they would be provided. The court observed that the petitioner could not file objections in the best possible manner without these documents, thus violating the principle of natural justice.

3. Availability and Furnishing of Documents:
The court noted that the debit notes were the "igniting factor" leading to the impugned order. The department assumed that these notes would be available with the petitioner, based on statements from the petitioner's personnel. However, the petitioner claimed that these debit notes were not traceable at the head office and might be with the customers. The court held that the absence of these documents significantly handicapped the petitioner in presenting its case effectively. The court directed that copies of all relevant documents and statements of accounts, which were the basis for the impugned order, be furnished to the petitioner within a week.

4. Legitimacy of the Impugned Order:
The court concluded that the impugned order deserved to be set aside due to the violation of natural justice. The court also considered the alternative remedy of filing an appeal under Section 31 of the Tamil Nadu General Sales Tax Act. However, it found that this would not be a practical solution, as the petitioner would still lack the necessary documents to support its case. The court emphasized that mandating the appellate authority to admit additional evidence would be beyond its jurisdiction. Consequently, the court set aside the impugned order and directed the authorities to provide the requested documents to the petitioner, allowing it to file objections within three weeks thereafter.

Conclusion:
The writ petition was disposed of by setting aside the impugned order due to the violation of natural justice. The court directed the authorities to furnish the necessary documents to the petitioner within a week, allowing the petitioner three weeks to file objections. The court dismissed the W.M.P. and made no order as to costs.