2018 (10) TMI 1407 - HC - VAT and Sales Tax

Validity of assessment order - assessment years 2011-2012 to 2016-2017 - issue involving mis-match - grievance of the petitioner is that the Assessing Officer has not followed the directions and guidelines issued by this Court, while dealing with mis-match issue in the case of JKM Graphics Solutions Vs. CTO, 2017 (3) TMI 536 - MADRAS HIGH COURT . Held that - There is no dispute to the fact that except for assessment year 2016-2017, in all other assessment years, one of the issue pertains to mis-match. The said issue was already considered by this Court and a common order was passed, wherein, certain guidelines and directions were issued as to how the mis-match issue has to be dealt with by the Assessing Officer, by adopting centralized mechanism, in JKM Graphics Solutions. It is evident that any order passed without complying with the above directions or guidelines, cannot be sustained, if the issue involved pertains to mis-match. Therefore, this Court is of the view that the matter has to go back to the Assessing Officer to re-do the assessment, once again on merits and in accordance with law, by following the procedures and guidelines issued in mis-match cases - petition allowed by way of remand.

Summary

Issues:
1. Assessment orders challenged for assessment years 2011-2012 to 2016-2017.
2. Allegation of non-compliance with court directions in dealing with mis-match issue.
3. Dispute over mis-match issue, short payment of tax, and stock discrepancy.
4. Petitioner's failure to respond to notices and utilize personal hearing opportunity.
5. Application of court guidelines for mis-match issue in assessment proceedings.

Analysis:

1. The petitioner challenged assessment orders for the years 2011-2012 to 2016-2017, alleging non-compliance with court directions in dealing with a mis-match issue. The petitioner, a dealer and assessee, contended that the Assessing Officer did not follow directions issued by the court in a previous case regarding mis-match issues.

2. The main issue in the assessment proceedings pertained to mis-match, except for the assessment year 2016-2017, where the issue was stock discrepancy. The petitioner argued that the Assessing Officer should have followed the court's directions on mis-match issues and completed the assessment accordingly. The respondent, however, argued that the petitioner did not respond to notices or utilize the opportunity of a personal hearing.

3. The court acknowledged that the mis-match issue was significant in all assessment years except 2016-2017. The court had previously issued guidelines on how to handle mis-match issues, emphasizing the need for a centralized mechanism to avoid multiple proceedings and ensure a fair process for dealers. The court directed a fresh assessment with a thorough inquiry and the establishment of a centralized mechanism.

4. The court emphasized that any order passed without complying with the guidelines on mis-match issues could not be sustained. Therefore, the court decided to remit the matter back to the Assessing Officer for a re-assessment following the prescribed procedures and guidelines. However, the court noted the petitioner's failure to respond to notices and utilize the personal hearing opportunity.

5. The court allowed the writ petitions, set aside the impugned orders, and remitted the matter back to the Assessing Officer for re-assessment. The petitioner was required to pay 15% of the tax liability for each assessment year and provide a reply to the notices of proposal within two weeks. The Assessing Officer was directed to re-do the assessment within six weeks after receiving the payment and reply, while affording the petitioner another opportunity for a personal hearing.

This detailed analysis covers the issues raised in the judgment, including the mis-match problem, the court's guidelines, the petitioner's compliance, and the court's decision on remitting the matter back for re-assessment.