2019 (9) TMI 1015 - HC - VAT and Sales Tax

Validity of assessment notice - violation of principles of natural justice - AO relied on certain third party documents to pass the impugned order without furnishing the same to the petitioner - HELD THAT - It is evident that the order of assessment was passed in the absence of any reply filed by the petitioner - There is no dispute to the fact that the petitioner sought for third party documents, which are relied on by the Assessing Officer. It is also not in dispute that those documents were not furnished to the petitioner so far. Needless to say that the petitioner will be in a position to furnish an effective reply, when those documents are furnished to them. Therefore, this Court is inclined to remit the matter back to the Assessing Officer to redo the assessment once again after furnishing those documents to the petitioner. Petition allowed by way of remand.

Summary

Issues:
Challenge to assessment order based on violation of principles of natural justice.

Analysis:
The petitioner challenged the assessment order for the year 2007-2008, alleging a violation of natural justice principles. The petitioner claimed that the Assessing Officer relied on third-party documents without providing them, leading to a lack of opportunity to respond effectively. It was further argued that the order did not demonstrate an independent application of mind, as it heavily relied on an Inspecting Officer's report. The petitioner contended that if given access to the third-party documents, they could refute the proposals made by the Assessing Officer.

Counter Affidavit and Response:
In response, the respondent stated that the petitioner had opportunities for personal hearings, which were not utilized effectively. The respondent claimed that the petitioner was called to the office to obtain the necessary documents but failed to do so. The petitioner's counsel explained that on certain occasions, the authorized representative was unavailable, and on other instances, despite appearing before the respondent, access to the required documents was denied.

Court's Decision and Directions:
After reviewing the facts and the assessment order, the Court noted that the assessment was conducted without the petitioner's reply. It was acknowledged that the petitioner had requested the third-party documents, which were crucial for a meaningful response. The Court decided to set aside the impugned order and remit the matter back to the Assessing Officer. Specific directions were given for the process to be followed, including the provision of the third-party documents, filing objections/replies, scheduling a personal hearing, and issuing the final assessment order within a specified timeframe.

Conclusion:
The Writ Petition was allowed, the impugned order was set aside, and the matter was remitted back to the Assessing Officer for a fresh assessment. The Court clarified that it was not expressing any opinion on the merits of the petitioner's claim, leaving it to the Assessing Officer's discretion. No costs were awarded, and the connected miscellaneous petition was closed.