2018 (10) TMI 1002 - HC - VAT and Sales Tax

Validity of assessment orders - TNVAT Act - principles of natural justice - factum of conduct of the personal hearing is disputed by the petitioner - Held that - From the dates of proceedings, it would be seen that notice issued on 20.03.2018 culminated in an order on 28.03.2018. When the objection was filed 20.03.2018, it is highly improbable for the respondent to fix the date for personal hearing and passing orders within weeks time. Therefore, the contention of the petitioner that an opportunity of personal hearing was not given to him appears to be probable. This Court in very many cases categorically held that an opportunity of personal hearing must be adhered while passing assessment orders.The Commissioner of Commercial Taxes has also issued instructions to the assessing authorities based on the recommendation of the Justice Sri Ramanujam Committee whereas it is mandated that whether the dealer asked for personal hearing or not it shall be afforded to them by the assessing authority. Wthout affording an opportunity, the impugned order is passed, which amounts to violation of principles of natural justice - the matter is remanded back to the respondent for fresh consideration - petition allowed by way of remand.

Summary

Issues:
Challenging assessment orders on grounds of violation of principles of natural justice.

Analysis:
The petitioner, a manufacturer of yarn, challenged assessment orders for multiple years under TNVAT Act, 2006, citing violation of natural justice principles. The petitioner had filed returns for the relevant years, which were deemed assessed. However, a revision notice was issued by the respondent after an inspection, highlighting discrepancies. The petitioner submitted objections, but the final orders were passed without a proper opportunity for a personal hearing. The court noted discrepancies in the timeline of events, indicating a lack of sufficient time for the respondent to conduct a personal hearing before passing the orders.

The court emphasized the importance of providing an opportunity for a personal hearing before passing assessment orders, citing previous cases and instructions from the Commissioner of Commercial Taxes. Referring to a Supreme Court case, it reiterated that even in the absence of a specific provision, a hearing is necessary unless excluded by law. The court concluded that the impugned orders, lacking a proper opportunity for a personal hearing, violated the principles of natural justice.

Consequently, the court set aside the assessment orders and remanded the matter back to the respondent for fresh consideration. The respondent was directed to provide the petitioner with a proper opportunity for a personal hearing and pass orders within one month from the date of receiving the court's order. The writ petitions were disposed of with no costs, and connected miscellaneous petitions were closed.