2017 (10) TMI 112 - HC - VAT and Sales Tax

Validity of assessment order - TNVAT Act - the petitioner has not cooperated with the assessment proceedings and has not produced the reconciliation statement to enable the Assessing Officer to complete the assessment - Held that - if the materials are placed in the petitioner s business premises, then obviously, invoices ought to have been raised in the name of the petitioner or else, it should have been shown as a product for demonstration purpose only and would be taken back by the manufacturer/supplier. However, these facts have to be established by the petitioner before the Assessing Officer, for which purpose, they are bound to produce the entire details of stock, more particularly, the closing stock details along with item code-wise reconciliation statement - this Court is of the view that one more opportunity could be granted to the petitioner to go before the assessing officer for producing all the necessary documents - petition allowed by way of remand.

Summary

Issues:
Challenge to assessment orders under Tamil Nadu Value Added Tax Act, 2006 for the assessment years 2013-14 and 2014-15 due to lack of cooperation by the petitioner and absence of reconciliation statement.

Analysis:
The petitioner, a registered dealer under the Tamil Nadu Value Added Tax Act, contested the assessment orders for the years 2013-14 and 2014-15. The petitioner failed to cooperate with the assessment proceedings, leading to incomplete assessment due to the absence of a reconciliation statement. The petitioner argued that they had provided original books of accounts and details, but the respondent did not examine them before passing the impugned orders. The petitioner relied on a previous court decision to support their claim that the assessment orders should be set aside and the matter remanded for fresh consideration.

The Additional Government Pleader contended that had the petitioner cooperated, the correct taxable turnover could have been determined during the assessment. However, the petitioner's lack of cooperation hindered the assessment process. The court noted that the petitioner did not produce an item code-wise reconciliation statement. The petitioner claimed to be dealers in consumer items displayed by manufacturers in their business premises without requiring immediate payment. The court emphasized the need for the petitioner to establish these facts before the Assessing Officer by providing detailed stock information, especially item code-wise reconciliation statements.

After considering the arguments and evidence, the court concluded that the petitioner should be given another opportunity to present all necessary documents to the assessing officer for a thorough assessment. The court allowed the writ petitions, set aside the impugned orders, and remanded the matter to the respondent for fresh consideration. The respondent was directed to schedule a personal hearing where the petitioner must appear and provide all required documents for a re-assessment in compliance with the law. No costs were awarded in this judgment, and the connected miscellaneous petitions were closed.