1996 (6) TMI 343 - AT - VAT and Sales Tax

Summary

Issues:
Challenge to assessment order and demand notice under West Bengal Sales Tax Act, 1994 due to lack of reasonable opportunity of hearing and failure to provide written denials from consignees.

Analysis:
The case revolves around an application challenging an assessment order and a demand notice issued under the West Bengal Sales Tax Act, 1994. The applicants, a partnership firm of transporters, carried goods from Delhi to Calcutta and delivered them to consignees. The respondents alleged that the firm was liable to pay tax under section 11 of the Act. The respondents claimed that the firm had imported goods in the names of different consignees to evade sales tax. The assessment order imposed a tax of Rs. 2,50,000, alleging that the firm acted as a casual trader and did not deliver goods to the consignees as claimed.

The respondents contended that the notice and assessment order were justified as the consignees denied importing the goods on their behalf. They relied on the presumption under section 11(1) of the Act, which was not rebutted by the applicants. Letters from consignees were submitted to support the claim that goods were not imported on their behalf.

The Tribunal found that the assessment order could not be sustained due to a lack of reasonable opportunity of hearing. The denials in writing obtained from consignees were not provided to the applicants during the assessment proceedings, depriving them of the chance to rebut the allegations. As a result, the Tribunal set aside the assessment order and demand notice on this ground, without delving into other points raised in the application.

Consequently, the application was allowed, and the assessment order along with the demand notice were set aside. The Tribunal directed that if the respondent wished to proceed afresh, it should do so in accordance with the law. The interim order was vacated, and the application was disposed of without any costs being awarded.