2015 (4) TMI 391 - HC - VAT and Sales Tax

Maintainability of appeal - Alternate remedy available - Held that - The facts of the case would reveal that the petitioner was afforded an opportunity and notice was issued under Section 22(4) of the TNVAT Act and the petitioner was also given an opportunity to file their objections and date was also fixed for personal hearing. The petitioner filed their objections, but, did not appear on the date fixed for personal hearing and the petitioner sought for adjournment on the ground that the sales tax practitioner was not available. The request made by the petitioner was accepted and the fresh date was assigned and even on that date also, the petitioner did not appear. Therefore, the authority proceeded to examine the objections and passed the impugned assessment orders. Therefore, it is not a case of violation of principles of natural of justice. But, it is a case where the petitioner failed to avail the opportunity granted. Therefore, on this ground, the petitioner cannot be permitted to bypass the appellate remedy available under the Act. Further, notices issued to the petitioner itself were under Section 22(4) of Act, wherein, the authority came to the conclusion that the returns filed by the petitioner were incomplete and incorrect. Therefore, before proceeding to assess the petitioner in best of its judgment, notices were issued. In such circumstances, the writ petitions held to be not maintainable - Decided against assessee.

Summary

Issues:
1. Whether the petitioner should be directed to challenge the assessment orders by filing an appeal before the appellate authority.
2. Whether the petitioner was afforded a reasonable opportunity of personal hearing before the impugned orders were passed and if the action of the respondent is in violation of principles of natural justice.

Analysis:

Issue 1:
The petitioner, a registered dealer under the Tamil Nadu Value Added Tax Act, challenged assessment orders for the years 2009-2013. The petitioner was issued notices proposing to reject filed returns as incorrect and incomplete, directing the petitioner to file objections and appear for a personal hearing. The petitioner filed objections but failed to appear for the personal hearing, leading to the authority confirming the proposal and demanding balance tax. The petitioner contended that the assessment was without jurisdiction and challenged the orders through writ petitions. The respondent argued that it was a case of best judgment assessment under Section 22(2), with the dealer given an opportunity to be heard but failing to avail it. The court found that the petitioner failed to avail the opportunity granted and must not bypass the appellate remedy available under the Act. The only remedy available now is to file appeals against the assessment orders or seek corrections under the TNVAT Act.

Issue 2:
The court considered whether the petitioner was afforded a reasonable opportunity of personal hearing and if the respondent's actions violated principles of natural justice. The petitioner was given notice, the opportunity to file objections, and a date for personal hearing. Despite seeking an adjournment due to the unavailability of their sales tax practitioner, the petitioner did not appear on the rescheduled date. The court held that the petitioner's failure to avail the opportunity granted did not constitute a violation of natural justice. The notices issued were under Section 22(4) of the Act, indicating that the returns were incomplete and incorrect before the best judgment assessment. Consequently, the writ petitions were dismissed, directing the petitioner to file appeals before the appellate authority while returning the original impugned orders and closing connected miscellaneous petitions.