2011 (3) TMI 1504 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of proceedings under section 32(2) of the Tamil Nadu General Sales Tax Act, 1959 during the pendency of an appeal.
2. Interpretation of section 32(2)(b) of the Act regarding the jurisdiction of the Deputy Commissioner.
3. Invocation of special powers under section 32 of the Act based on prejudicial assessment orders.
4. Compliance with section 36(3) of the Tamil Nadu General Sales Tax Act, 1959 in disposing of an appeal.

Analysis:
1. The main contention in this case was whether the first respondent could pass proceedings under section 32(2) of the Tamil Nadu General Sales Tax Act, 1959 while an appeal was pending before the Tamil Nadu State Appellate Tribunal. The petitioner argued that such actions were against the provisions of the Act, citing a Supreme Court decision and a previous court ruling to support their stance. The court found that the impugned proceedings were not valid during the appeal process, setting aside the actions of the first respondent.

2. The interpretation of section 32(2)(b) of the Act was crucial in determining the jurisdiction of the Deputy Commissioner to pass orders. Referring to the wording of the section, the court emphasized that once an order has been made the subject of an appeal, the Deputy Commissioner cannot interfere, even if only part of the order is under appeal. The court upheld the Tribunal's decision that the Deputy Commissioner had acted without jurisdiction in such cases.

3. The issue of invoking special powers under section 32 of the Act based on prejudicial assessment orders was raised. The petitioner argued that the first respondent could not use these powers if the earlier assessment order was prejudicial to the Revenue. The court agreed with the petitioner's submission and held that such invocation was not permissible in the circumstances presented.

4. Compliance with section 36(3) of the Tamil Nadu General Sales Tax Act, 1959 in disposing of an appeal was discussed. The court highlighted the requirement for the Appellate Tribunal to provide the appellant with a reasonable opportunity to be heard and to record reasons in writing. The absence of a counter-affidavit from the respondents was noted, and the court found it appropriate to set aside the impugned proceedings of the first respondent based on the submissions made and the decisions cited. As a result, the writ petition was allowed, with no costs imposed, and the connected miscellaneous petition was closed.