2013 (1) TMI 380 - HC - VAT and Sales Tax

Tamil Nadu Value Added Tax Act 2006 - Rule 12-A of the Tamil Nadu Value Added Tax Rules, 2007 Petitioner seeking clarification about tax rate on coconut plucking equipment Said product taxable at 14.5%, under Entry 69 of Part C of the First Schedule of the act Commercial Tax Officer had passed the proceedings by way of a clarification - Opportunity of being heard - Held that - No opportunity of personal hearing had been given to the petitioner before the impugned proceedings had been passed by the second respondent, on 27.7.2012. Therefore, it appropriate to set aside the impugned proceedings of the second respondent, dated 27.7.2012. The matter is remitted back to the second respondent, for passing an appropriate order. Set aside the order - Remand back to Commercial Tax Officer

Summary

Issues: Opportunity of personal hearing under Rule 12-A of Tamil Nadu Value Added Tax Rules, 2007

Analysis:
The petitioner, a registered dealer under the Tamilnadu Value Added Tax Act, 2006 and Central Sales Tax Act, 1956, sought clarification on the tax rate applicable to coconut plucking equipment. The Commercial Tax Officer issued proceedings stating the product is taxable at 14.5% without providing a personal hearing to the petitioner. The petitioner contended that the proceedings were issued in violation of Rule 12-A of the Tamil Nadu Value Added Tax Rules, 2007, which mandates a personal hearing. The respondents argued that a personal hearing is only provided if requested by the party under clause 7 of the Rules and that the clarification issued by the officer is final and binding.

The Court observed that no opportunity of personal hearing was given to the petitioner before passing the impugned proceedings. Consequently, the Court set aside the proceedings and remitted the matter back to the Commercial Tax Officer for an appropriate order. The Court directed the officer to issue a notice to the petitioner, provide a personal hearing, and pass an order on the clarification sought by the petitioner. The Court emphasized the need for expeditious action by the officer in this regard.

In conclusion, the Court ordered in favor of the petitioner, highlighting the importance of providing an opportunity for a personal hearing as per the relevant rules. The judgment serves as a reminder of the procedural fairness required in tax matters, ensuring that parties have a chance to present their case before decisions are made.