2019 (7) TMI 1749 - HC - VAT and Sales Tax

Levy of Entry Tax - no returns of entry tax have been filed - determination of purchase turnover of the vehicles to the best of his judgment - Section 15(1) of the Entry Tax Act - HELD THAT - Admittedly, though an opportunity was granted to the petitioner to file objections, the petitioner had not filed any, which has resulted in the impugned order being passed confirming the proposals made. Though the order of assessment is impugned before me, learned counsel for the petitioner restricts his plea to the set off of Value Added Tax VAT against the entry tax liable to be paid in terms of Section 4 of the Entry Tax Act. That is so. However, the petitioner has not filed his objections to the assessment proposal when it could have raised the question of set off - the assessing authority has also granted no opportunity of personal hearing. Balancing the interests of justice, I am thus inclined to remand the matter and set aside the impugned order. Mr.A.Thiyagarajan, appearing for the respondents does not have any serious objection to such remand. The petitioner will appear before the assessing officer on 09.08.2019 Friday at 10.30 a.m., and produce all particulars in support of its stand, including the question of set off of VAT as against entry tax liability - petition allowed.

Summary

Issues:
Challenge to order under Entry Tax Act for 2014-15, failure to file returns, assessment without objections, set off of VAT against entry tax, lack of opportunity for personal hearing.

Analysis:
The petitioner, a motorcycle dealer, challenged an order passed under the Tamil Nadu Tax on Entry of Motor Vehicles into Local Areas Act, 1990 for the period 2014-15. The assessing authority proposed determining the purchase turnover of vehicles and levying tax and penalty as per the Entry Tax Act due to the petitioner's failure to file entry tax returns. Despite being given an opportunity to file objections, the petitioner did not do so, leading to the confirmation of the proposed assessment.

The petitioner's counsel focused the plea on the set off of Value Added Tax (VAT) against the entry tax liability, which was not raised earlier due to the petitioner's failure to file objections. The assessing authority did not provide a personal hearing, prompting the court to remand the matter and set aside the impugned order to ensure justice. The respondent did not object to the remand, and the petitioner was directed to appear before the assessing officer to present supporting documents, including the VAT set off issue, without the need for further notice.

The court allowed the Writ Petition, directing the assessing officer to pass orders de novo within four weeks from the conclusion of the personal hearing, affording the petitioner a fair opportunity to present its case. The judgment emphasized the importance of a personal hearing and the right to raise objections in assessment proceedings. The decision highlighted the need for procedural fairness and adherence to legal principles in tax assessments under the Entry Tax Act.