2019 (2) TMI 68 - HC - VAT and Sales Tax

Principles of natural justice - case of petitioner is that the Assessing Officer has passed the impugned order without affording sufficient opportunity to the petitioner to produce the relevant documents inpite of their request made in writing to that effect - Held that - There is a reasonable presumption on the part of the assessee to wait for a communication from the Assessing Officer in respect of their request for extension of time. If the Assessing Officer has passed the assessment order without informing the assessee as to whether the request for time is granted or rejected, it has to be construed that the assessment made thereafter, is in violation of principles of natural justice. The very same issue was considered by this Court in the case of Tvl Vikranth Construction Vs Deputy Commercial Tax Officer, Cuddalore 2017 (5) TMI 319 - MADRAS HIGH COURT , where it was held that The assessment order passed without intimating the decision taken on the request for extension of time, is in violation of the principles of natural justice and therefore on that ground alone, the assessment order has to be set aside. The matter is remitted back to the Assessing Officer to redo the assessment - appeal allowed by way of remand.

Summary

Issues:
1. Violation of principles of natural justice in passing the assessment order without granting sufficient opportunity to produce relevant documents.
2. Failure to communicate the decision on the request for extension of time for assessment.
3. Remitting the matter back to the Assessing Officer for a fresh assessment.

Issue 1: Violation of principles of natural justice
The petitioner challenged the assessment order for the year 2016-2017, alleging that the Assessing Officer did not provide adequate opportunity to produce necessary documents despite requests. The petitioner cited a previous court decision to support their claim. The Additional Government Pleader for the respondents argued that the order was issued after granting sufficient time, which the petitioner failed to utilize. The court noted that although the petitioner had requested extensions to submit all relevant details, the assessment was completed before the extended deadline without informing the petitioner of the decision on the time extension request. Citing a previous case, the court emphasized that failure to communicate the decision on extension requests violates principles of natural justice. As a result, the assessment order was set aside, and the matter was remitted back to the respondent for a fresh assessment with proper hearing opportunities for the petitioner.

Issue 2: Failure to communicate decision on time extension request
The court highlighted that the Assessing Officer's failure to inform the petitioner about the decision on the requested extension of time for assessment constitutes a violation of natural justice principles. Referring to a previous case, the court emphasized that any decision on time extension requests should be communicated promptly to the assessee to enable them to proceed accordingly. In this case, the absence of communication regarding the extension request decision led to the setting aside of the assessment order, underscoring the importance of timely and clear communication in assessment proceedings.

Issue 3: Remitting the matter back for a fresh assessment
Considering the circumstances and the precedent set by a similar case, the court decided to grant the petitioner another opportunity to submit all necessary documents and forms for assessment. Without expressing any opinion on the assessment order's merits, the court set aside the impugned order and remitted the matter back to the Assessing Officer with specific conditions. The petitioner was instructed to provide all relevant documents within two weeks, following which a personal hearing date would be scheduled by the Assessing Officer. Subsequently, the Assessing Officer was directed to pass fresh assessment orders within four weeks of the personal hearing. The court emphasized the importance of cooperation from the petitioner in the assessment process to ensure a timely and fair assessment outcome.