2018 (10) TMI 206 - HC - VAT and Sales Tax

Validity of revised orders of assessment - grievance of the petitioner before this Court is that the respondent is not entitled to revise the assessment in respect of those two assessment years, when already the deemed assessment had taken place as early as in the month of October, 2014 & 2015, merely, because the petitioner has crossed the ceiling of ₹ 50 Lakhs in the subsequent assessment years. Held that - The learned Government Advocate is not in a position to explain and satisfy this Court as to how the penalty under Section 27(3)(c) of the TNVAT Act, was levied on the petitioner, when the notice of proposal indicated that the same was proposed under Section 22(5) of the TNVAT Act - Further perusal of the impugned orders would also show that the petitioner was not provided with any personal hearing. No doubt, the notices of proposal indicated that either the petitioner in person or his authorized representative is entitled for personal hearing within 15 days on receipt of the said notice. However, it is seen that the respondent has not sent any further communication indicating the date of personal hearing to the petitioner. Therefore, this Court is of the view that, without expressing any view on the merits of the assessment, the matter needs to be remitted back to the respondent for re-considering the matter afresh, after giving due opportunity of hearing to the petitioner. The matter is remitted back to the respondent for passing fresh orders of assessment, after giving due opportunity of personal hearing to the petitioner - petition allowed by way of remand.

Summary

Issues:
Challenging revised assessment orders for assessment years 2013-2014 and 2014-2015.
Validity of revising assessment due to exceeding turnover ceiling.
Imposition of penalty under Section 27(3)(c) of the TNVAT Act without providing a personal hearing.

Analysis:
The petitioner challenged the revised assessment orders for the assessment years 2013-2014 and 2014-2015, arguing that the respondent had no right to revise the assessment as the deemed assessment had already taken place when the turnover did not exceed ?50 Lakhs. The petitioner contended that the imposition of penalty under Section 27(3)(c) of the TNVAT Act, 2006, without a personal hearing, was erroneous. The respondent issued notices proposing to revise the assessment, claiming that the petitioner had crossed the turnover ceiling in those assessment years as well. The respondent called for objections and indicated the levy of penalty under Section 22(5) of the TNVAT Act. The petitioner objected to the proposal, but the impugned orders confirmed the proposal and imposed a penalty at 150%.

The learned Government Advocate for the respondent argued that the revised assessment was made after considering the objections raised by the petitioner. However, the court noted that the imposition of penalty under Section 27(3)(c) of the TNVAT Act was not adequately explained. The court observed that the petitioner was not provided with a personal hearing despite the notice indicating the right to one within 15 days. The court concluded that the matter needed to be remitted back to the respondent for reconsideration, emphasizing the importance of providing a due opportunity of hearing to the petitioner.

In the final judgment, the court allowed the writ petitions, setting aside the impugned orders and remitting the matter back to the respondent for fresh assessment orders. The court directed the respondent to provide a personal hearing to the petitioner within four weeks from the date of receipt of the order. No costs were awarded, and the connected miscellaneous petitions were closed.