1997 (5) TMI 411 - HC - VAT and Sales Tax

Summary

Issues:
- Lack of opportunity for the petitioner during the assessment process
- Validity of the order of assessment passed by the Deputy Commercial Tax Officer without affording an opportunity to the petitioner
- Interference with the order of assessment by the High Court
- Requirement of deposit for filing an appeal against the assessment order
- Constitutional obligation of the High Court to ensure principles of natural justice are upheld

Analysis:

The High Court judgment pertains to an appeal against an order dismissing a writ petition challenging an assessment order. The appellant contended that the assessment was conducted without providing any opportunity to present their case, as requested records were not supplied. The Court noted that the order of assessment was ex parte, violating the principles of natural justice. It was observed that no order with civil consequences should be passed without affording an opportunity to the concerned party. The Court held that the order by the Deputy Commercial Tax Officer was unjust as the appellant had no chance to explain the circumstances.

Regarding the terms of interference with the assessment order, the Court mentioned that the taxable turnover, tax amount, and penalty were specified in the order. The appellant was informed that to file an appeal, a deposit of at least 25% of the tax assessed would be required. The Court emphasized its duty to ensure proper functioning of tribunals within its jurisdiction and adherence to natural justice principles. Despite the appellant agreeing to deposit the required amount, the Court clarified that its jurisdiction was not based on this condition but on upholding constitutional obligations.

Consequently, the Court allowed the appeal, set aside the previous order, and granted relief to the appellant. The order of assessment was quashed on the condition that the appellant deposits 25% of the tax assessed by a specified date. The assessing officer was directed to issue a notice to the appellant, allowing them to present objections and produce records. The assessment proceedings were to be completed within a specified timeline, and in case of non-taxability, the deposited amount would be refunded with interest. Failure to deposit the amount would result in the restoration of the assessment order. The Court also dismissed a related application and awarded no costs in the matter.