2009 (1) TMI 805 - AT - VAT and Sales Tax

Summary

Issues:
Challenge to cancellation of registration certificate under State and Central Sales Tax Acts without proper hearing and in violation of natural justice.

Analysis:
The petitioner, a reseller and distributor of metal products, challenged the cancellation of registration certificates by the Sales Tax Officer, alleging lack of proper hearing and violation of natural justice. The petitioner contended that the cancellation was based on the alleged non-existence of the business at the declared location, which was disputed. The petitioner claimed to have received all letters at the business address, contradicting the officer's allegation. The petitioner also argued that copies of reports relied upon were not provided, denying the opportunity to rebut. The learned advocate cited relevant case laws emphasizing the importance of natural justice in such matters.

The State Representative argued that the cancellation was justified as the petitioner's representative admitted the non-existence of the business at the declared location due to a dispute with the landlord. The State Representative relied on section 29(1)(a) of the West Bengal VAT Act, 2003, to support the cancellation based on the admission of non-existence. However, it was noted that copies of inspection reports were not provided to the petitioner, violating the principles of natural justice. The Tribunal referred to previous judgments highlighting the importance of providing such reports for a fair opportunity to rebut allegations.

In considering the case and the relevant legal precedents, the Tribunal set aside the order of cancellation by the Sales Tax Officer. The Tribunal emphasized the need for natural justice and directed that if the officer intended to proceed with the cancellation, copies of the reports relied upon must be provided to the petitioner along with a show-cause notice. The decision was made in light of ensuring a fair opportunity for the petitioner to respond to the allegations. The judgment concluded by allowing the application without imposing any costs on either party, considering the circumstances of the case.

SAIKH ABDUL MOTALEB (Judicial Member) concurred with the decision, indicating a unanimous agreement on setting aside the cancellation order and emphasizing the importance of upholding principles of natural justice in such matters.