2018 (4) TMI 1814 - HC - VAT and Sales Tax

Violation of principles of natural justice - Validity of assessment order - impugned orders are challenged on the short ground that show cause notices as well as personal hearing in both these cases were granted by one Officer, but the impugned orders were passed by a different Officer - HELD THAT - If a case is heard by one Bench in a Court of Law and the judgment is delivered by another Bench without any further hearing, the same would tantamount to a judgment being delivered without hearing. The very purpose of personal hearing is to enable the Assessing Officer to either get enlightened or to enlighten the Assessee about the nature of the claim made by them. It is actually a two way communication. It has been repeatedly held that wherever a request is made for personal hearing, but the same was not granted, the orders passed without the grant of personal hearing are in violation of the principles of justice. Therefore, there is no use in contending that someone else has already heard the case and passed on the information to the present incumbent. The impugned orders are set aside and the Officer now holding the post is directed to give an opportunity of personal hearing to the petitioners. After granting the opportunity of personal hearing, the Assessing Officer shall pass appropriate orders in accordance with law - Petition allowed.

Summary

Issues: Challenge to assessment orders based on violation of principles of natural justice.

Detailed Analysis:

Issue 1: Violation of Principles of Natural Justice
The petitioners, both Dealers under the Andhra Pradesh Value Added Tax Act, challenged assessment orders passed under the Act, alleging a violation of natural justice. The petitioners contended that show cause notices and personal hearings were conducted by one Officer, but the impugned orders were passed by a different Officer. The respondents argued that the current Officer considered objections and reviewed the file before issuing the orders, hence not violating natural justice principles. However, the Court disagreed, emphasizing that personal hearing is essential for effective communication between the Assessing Officer and the Assessee. The Court held that passing orders without granting a personal hearing, even if the case was previously heard by another Officer, violates the principles of natural justice.

Issue 2: Judicial Precedents on Personal Hearing
The Court referred to the importance of personal hearing in legal proceedings. It highlighted that denying personal hearing when requested constitutes a violation of justice principles. The Court drew an analogy to a scenario where a case is heard by one Bench but decided by another, stressing that personal hearing is crucial for proper communication and understanding of the case. The judgment emphasized that personal hearing serves the purpose of enlightening both parties about the claims and facilitating a two-way communication process. Therefore, the Court held that the failure to grant a personal hearing is a breach of natural justice, regardless of prior information sharing between Officers.

Judgment:
In light of the above analysis, the Court allowed the writ petitions, setting aside the impugned assessment orders. The Officer currently in charge was directed to provide the petitioners with a personal hearing opportunity. Following the personal hearing, the Assessing Officer was instructed to issue appropriate orders in accordance with the law. The Court dismissed any pending miscellaneous petitions and made no order regarding costs in the case.