2014 (3) TMI 609 - HC - VAT and Sales Tax

Opportunity of being heard - order u/s 21(2) of the U.P. Trade Tax Act 1948 reassessment proceedings - Held that - Decisions in SK. Traders Versus Additional Commissioner 2007 (7) TMI 573 - ALLAHABAD HIGH COURT & Rajesh Kumar And Others Versus Deputy Commissioner of Income-Tax And Others 2006 (11) TMI 135 - SUPREME Court followed - Only because certain consequences would ensue if the principles of natural justice are required to be complied with, the same by itself would not mean that the court would not insist on complying with the fundamental principles of law - If the principles of natural justice are to be excluded, the Parliament could have said so expressly - ordinarily unless excluded by operation of a statute, the superior courts while exercising power of judicial review shall proceed on the basis that assignment of reasons is imperative in character. While applying the principles of natural justice the court must also bear in mind the theory of useless formality and the prejudice doctrine Justice is not only be done but manifestly seem to be done - Opportunity of hearing has to be given to every assessee by the AC or C while considering the proposal for sanctioning/issuing of notice for reassessment under the proviso to Sub-section (2) of Section 21 of the Act and reasons are also to be recorded while granting sanction - Order set aside AC had not given any reasons for granting permission/sanction to proposal to reopen the assessment thus all proceedings taken in pursuance of the order also set aside - Decided in favour of assessee.

Summary

Issues:
Challenge to order dated 17.12.2005 passed by Additional Commissioner, Grade-I, Trade Tax, Kanpur Zone, Kanpur for A.Y. 1999-2000 under Section 21(2) of the Act.

Detailed Analysis:
The petitioner filed a writ petition challenging the order dated 17.12.2005 passed by the Additional Commissioner, Grade-I, Trade Tax, Kanpur Zone, Kanpur, for the assessment year 1999-2000 under the Central Sales Tax Act. The petitioner contended that despite submitting a detailed reply to the notice dated 11.11.2005, the Additional Commissioner did not consider the petitioner's submissions and granted approval only in the interest of revenue. The petitioner argued that the impugned order should be set aside as it did not take into account the material facts presented by the petitioner.

The petitioner's counsel cited previous court decisions to support their contention. They referenced cases such as M/s Hind Agro Industries Ltd. vs. State of U.P. and M/s S.K.Traders, Modi Nagar, Ghaziabad vs. Additional Commissioner, Grade-I, Trade Tax, Zone Ghaziabad to emphasize the importance of considering submissions and providing reasons while passing orders related to reassessment.

The court, upon reviewing the impugned order, noted that the Additional Commissioner had not considered the petitioner's detailed reply submitted in response to the notice dated 11.11.2005. Citing the scope and ambit of Section 21(2), the court referred to previous judgments emphasizing the necessity of providing an opportunity for hearing to the assessee and recording reasons while granting approval for reassessment.

Based on the lack of reasons provided in the impugned order, the court set aside the order dated 17.12.2005 and directed the Additional Commissioner to pass a fresh order in accordance with the law, ensuring an opportunity of hearing for the petitioner and recording reasons for the decision. Consequently, the notice dated 11.11.2005 was also set aside. The court held that the writ petition succeeded and was allowed to the extent mentioned in the judgment.