2009 (12) TMI 860 - HC - VAT and Sales Tax

Whether, on the facts and circumstances of the case, the Trade Tax Tribunal was legally justified to reject the book version and make best judgment assessment on the basis of the unnumbered bills furnished by the complainant to the Trade Tax Officer (S.I.B) alleging them to relate to the revisionist without supplying the copies of such bills to the revisionist whereas the revisionist had categorically denied issuing any such bills and had specifically requested to supply copies of these bills or to show these bills to him? Whether, on the facts and circumstances of the case, the lower authorities were legally justified to deny the revisionist an opportunity of cross-examining the complainant who had furnished the unnumbered bills to the Trade Tax Officer (S.I.B) in gross violation of the principles of natural justice? Held that - It is established principle of law that the assessment is not a question of law but is a question of fact and as per established proposition of law this court while exercising of power of judicial review under section 11 of the Trade Tax Act, 1948 can interfere in the order passed by the Tribunal only if the question of law is involved as in the present case no question of law is involved rather order passed by the Tribunal is concluded by findings of fact. So there is not need to interfere in the matter in question while exercising the revisional power. In these circumstances, the assessee cannot take a plea that no opportunity has been given to him to establish his case. In view of the abovesaid fact, the order of the Tribunal which is under challenge in the present revision cannot be assailed on the ground that no opportunity of hearing was given to the revisionist and the order which is passed by the Tribunal is in violation of principles of natural justice. Revision dismissed.

Summary

Issues:
1. Rejection of book version and best judgment assessment based on unnumbered bills.
2. Denial of opportunity for cross-examination.

Analysis:

Issue 1: Rejection of book version and best judgment assessment based on unnumbered bills
The High Court heard arguments regarding the rejection of the revisionist's book version and the subsequent best judgment assessment based on unnumbered bills. The revisionist contended that the unnumbered bills allegedly related to them were not provided for verification and requested an opportunity to cross-examine the complainant. The court referenced legal precedents emphasizing the importance of natural justice, requiring parties to be supplied with relevant material or allowed to inspect it. The court found that the assessing authority did not properly address the issue of unnumbered bills and denied the revisionist a fair chance to challenge the evidence against them. As a result, the court concluded that the order passed by the Tribunal was not sustainable and needed to be set aside, sending the case back for reassessment.

Issue 2: Denial of opportunity for cross-examination
The revisionist also raised concerns about being denied the opportunity for cross-examination, which was considered a violation of natural justice. Legal judgments were cited to support the revisionist's argument that the right to cross-examine witnesses is essential for a fair assessment process. The court noted that the assessing authority failed to summon a key individual for cross-examination as requested by the revisionist, leading to a lack of proper investigation. The court emphasized that the denial of this opportunity undermined the principles of natural justice and affected the validity of the assessment order. Consequently, the court ruled that the Tribunal's decision was flawed and needed to be set aside due to the procedural irregularities.

In conclusion, the High Court dismissed the revision, highlighting that the assessment process was based on factual findings and did not involve legal questions. The court emphasized that the Tribunal's decision was supported by concurrent findings of fact from lower authorities, indicating no illegality or perversity in the challenged order. The court clarified that the assessment process was within the Tribunal's jurisdiction as the final fact-finding authority, and there was no legal basis for interference in the absence of a question of law. Thus, the revision was dismissed, and no costs were awarded.