2019 (6) TMI 1201 - HC - VAT and Sales Tax

Principles of natural justice - validity of assessment order - TNVAT Act - assessment without notice - HELD THAT - Without expressing any opinion on whether the impugned orders are consequent upon the assessment orders made under CST Act, this Court is of the considered view that it cannot be gainsaid that it is not necessary to give notice and opportunity to the writ petitioner assessee before making an assessment under TNVAT Act particularly when there has only been deemed assessment thus far under Section 22(2) of TNVAT Act. It therefore follows as an inevitable sequitur that the impugned orders deserve to be set aside solely on the ground of violation of NJP. The respondent shall redo the assessments by issuing a fresh notices to the writ petitioner assessee - petition allowed by way 0f remand.

Summary

Issues: Violation of Natural Justice Principles in assessment orders under TNVAT Act.

In this case, two writ petitions were filed challenging the Revised Assessment Orders passed by the respondent under the Tamil Nadu Value Added Tax Act, 2006 (TNVAT Act). The writ petitioner, a manufacturing concern, contended that the assessment orders were made without following the principles of natural justice (NJP) as no notice or opportunity was given to the assessee. The respondent argued that the impugned orders were consequential to assessments under the Central Sales Tax Act, 1956 (CST Act). The court noted that despite the connection to CST Act assessments, it was essential to provide notice and opportunity to the assessee before making an assessment under the TNVAT Act, especially when only deemed assessments had been done under Section 22(2) of TNVAT Act. Consequently, the court set aside both impugned orders solely on the ground of NJP violation.

The court directed the respondent to redo the assessments by issuing fresh notices to the writ petitioner, who must respond within the stipulated timeframe without seeking extensions. The respondent was instructed to provide a personal hearing to the writ petitioner, where supporting documents could be presented before the Assessing Authority. Following this procedure, the respondent was mandated to pass fresh assessment orders for the two relevant assessment years under the TNVAT Act in accordance with the law. The writ petitions were disposed of with the aforementioned directions, and no costs were awarded in the matter.