2019 (5) TMI 708 - HC - VAT and Sales Tax

Principles of natural justice - Validity of assessment order - TNVAT Act - It is the case of the petitioner that the respondent has arbitrarily, illegally and against the principles of natural justice has passed the impugned assessment order dated 24.12.2018 - HELD THAT - In the case on hand, the petitioner has been afforded adequate opportunities and has also been granted the right of personal hearing which he failed to utilize but instead of participating in the assessment proceedings by attending to the hearings personally, after passing of the assessment order or instead of filing a statutory appeal under section 51 of the TN VAT Act 2006, has filed this writ petition which is not maintainable in the considered view of this Court - The only remedy for the petitioner is only to file a statutory appeal under Section 51 of the TN VAT Act, 2006 as there is no violation of the principles of natural justice by the respondent. Petition dismissed.

Summary

Issues: Challenge to assessment order on grounds of arbitrariness, illegality, and violation of natural justice; Request for direction to furnish records and pass fresh assessment order; Maintainability of writ petition under Article 226.

Analysis:
1. Challenge to Assessment Order: The petitioner filed a writ petition challenging the assessment order dated 24.12.2018, alleging arbitrariness, illegality, and violation of natural justice. The petitioner sought a direction to furnish records as requested in previous replies and to pass a fresh assessment order based on guidelines from a specific case law.

2. Background and Allegations: The petitioner, a registered dealer under the TN VAT Act 2006, received a notice regarding non-reporting of sales of branded footwear above a certain value. The petitioner responded to the notices, requested details for assessment revision, and submitted relevant documents. However, subsequent notices and demands for records were issued by the respondent, leading to objections and further requests for clarification by the petitioner.

3. Contentions and Objections: The petitioner raised objections to the revision of assessment notice, highlighting discrepancies in reported turnover figures, imposition of tax on exempted turnover, and lack of justification for tax levies. The petitioner consistently requested break-up details and additional time to produce records, emphasizing the need for clarity and fairness in the assessment process.

4. Assessment Order Examination: The court examined the impugned assessment order and noted the petitioner's admission of non-maintenance of detailed accounts, non-issuance of sales bills, and non-filing of tax returns. The order also mentioned the petitioner's failure to appear for a scheduled personal hearing despite repeated requests for postponement.

5. Judicial Observations: The court observed that the petitioner had been granted adequate opportunities, including the right to a personal hearing, which was not utilized effectively. The delay in assessment proceedings was attributed to the petitioner's tactics, leading to the eventual passing of the assessment order.

6. Legal Considerations: The court emphasized that the petitioner had the statutory remedy of filing a statutory appeal under Section 51 of the TN VAT Act 2006. It was noted that the principles of natural justice were not violated by the respondent, making the writ petition under Article 226 not maintainable in this case.

7. Court Decision: Consequently, the court dismissed the writ petition, stating that there was no merit in the petitioner's challenge to the assessment order. The petitioner was directed to file a statutory appeal within two weeks from the date of the court's order. The court highlighted the importance of availing the statutory appellate remedy provided under the law in such matters.