2011 (8) TMI 1030 - HC - VAT and Sales Tax

Revision of assessment - Personal hearing opportunity not given - Violation of principle of natural justice - Held that - Special Government Pleader is correct in his submissions that the judgment of the Division Bench should be understood in the context of the circular of the respondent providing for personal hearing as otherwise the Division Bench would not have rendered such a findings. The Tamil Nadu General Sales Tax Act uses the wordings reasonable opportunity to show cause in certain contingencies and reasonable opportunity of being heard in certain contingencies. Wherever the statute has used the wordings reasonable opportunity of being heard then the Department is bound to give an opportunity of personal hearing. However section 16(1)(a) does not use the wordings reasonable opportunity of being heard but only uses the wordings reasonable opportunity to show cause . However the respondent himself issued the circular which provides for personal hearing while exercising revisional power under section 16(1) of the TNGST Act and the said circular applies to the order of assessment concerned in these writ petitions. Hence judgment of the Division Bench squarely applies to the facts of these cases. Therefore for not providing an opportunity of personal hearing the impugned orders are liable to be quashed and accordingly the same are quashed. The writ petitions are allowed and the matter is remanded back to the respondent to pass orders afresh under section 16(1)(a) of the TNGST Act after providing an opportunity of personal hearing to the petitioner within a period of eight weeks from the date of receipt of a copy of this order - Decided in favour of Revenue.

Summary

Issues: Assessment under Tamil Nadu General Sales Tax Act, 1959 and Central Sales Tax Act, 1956; Revision of assessment under section 16(1) of Tamil Nadu General Sales Tax Act, 1959 without personal hearing.

In the judgment delivered by Justice D. Hariparanthaman of the Madras High Court, the petitioner, an assessee under the Tamil Nadu General Sales Tax Act, 1959 and the Central Sales Tax Act, 1956, challenged the revision of assessments for the years 2001-02, 2002-03, and 2003-04 under section 16(1) of the Tamil Nadu General Sales Tax Act, 1959. The respondent sought to revise the assessments without providing a personal hearing to the petitioner, leading to the filing of writ petitions to quash the orders. The petitioner argued that a previous judgment required a personal hearing in such cases, while the respondent contended that the judgment was based on a circular that did not apply in this situation.

The court considered the arguments presented by both parties. The petitioner relied on a Division Bench judgment that mandated personal hearings in revision cases, while the respondent highlighted that the judgment was based on a circular requiring personal hearings. The court analyzed the language of the Tamil Nadu General Sales Tax Act, noting the distinction between "reasonable opportunity to show cause" and "reasonable opportunity of being heard." While section 16(1)(a) used the former, a circular issued by the respondent mandated personal hearings during revision under the Act. Consequently, the court found that the Division Bench judgment applied to the present case, as the circular necessitated a personal hearing despite the specific wording of the statute.

Therefore, the court ruled in favor of the petitioner, quashing the impugned orders for lack of a personal hearing and remanding the matter back to the respondent for fresh orders under section 16(1)(a) of the Tamil Nadu General Sales Tax Act, with a directive to provide a personal hearing to the petitioner within eight weeks. The judgment emphasized the importance of adhering to procedural requirements, as outlined in the circular, even if not explicitly stated in the statutory language. The writ petitions were allowed, and no costs were imposed on either party.