2018 (6) TMI 1801 - HC - VAT and Sales Tax

Validity of assessment order - non-service of revision notices on the petitioner - paver finisher machine purchased by the petitioner - motor vehicle or not and is capable of plying on the road or not - HELD THAT - This Court is of the view that the assessment should be redone by considering the petitioner's objections. In the result, this writ petition is disposed of by directing the petitioner to treat the impugned order as a show cause notice and submit their objections within a period of fifteen days from the date of receipt of a copy of this order. On receipt of the objections, the respondent shall consider the same as well as the documents on brochures that the petitioner may produce and if necessary, the respondent can inspect the equipment and then after affording an effective opportunity of personal hearing, redo the assessment in accordance with law. Till the assessment is completed in terms of the above direction, no coercive action shall be initiated against the petitioner.

Summary

Issues:
1. Challenge to assessment order under TNVAT Act, 2006 for the year 2015-16.
2. Non-service of revision notices and dispute regarding entry tax on paver finisher machine.

Analysis:
1. The petitioner contested the assessment order under the TNVAT Act, 2006 for the year 2015-16 on two main grounds. Firstly, it was argued that the revision notices dated 29.11.2017 and 09.03.2013 were not properly served on the petitioner. Secondly, the petitioner disputed the demand of entry tax on the paver finisher machine, claiming it was not a motor vehicle and incapable of plying on the road.

2. The Government Advocate provided a copy of the registration slip to demonstrate that the revision notices were dispatched via registered post on 05.12.2017. However, the absence of a postal acknowledgment card raised doubts about the actual service of the revision notices on the petitioner. On the issue of the paver finisher machine, reference was made to a precedent involving the case of Rds Projects Ltd. vs. Commercial Tax Officer, where it was established that certain equipment, like excavators, did not fall under the definition of motor vehicles for the purpose of entry tax.

3. In light of the presented facts and legal precedents, the Court decided that the assessment needed to be revisited, taking into account the petitioner's objections. The Court directed the petitioner to treat the assessment order as a show cause notice and submit objections within fifteen days of receiving the Court's order. The respondent was instructed to consider the objections, any additional documents or brochures provided by the petitioner, and conduct inspections if necessary. Following this, an opportunity for a personal hearing was to be granted before redoing the assessment in compliance with the law. The Court also ordered that no coercive actions should be taken against the petitioner until the reassessment was completed. No costs were awarded, and the connected miscellaneous petition was closed.