2020 (7) TMI 583 - HC - VAT and Sales Tax

Principles of Natural Justice - petitioner did not avail opportunity of personal hearing - HELD THAT - Whether or not the petitioner availed the opportunity of personal hearing, it is the duty of the 1st respondent, as appellate authority, to deal with the contentions raised in the grounds of appeal filed by petitioner and the 1st respondent could not have rejected the appeal only on the ground that personal hearing opportunity was not availed by the petitioner. The appeal filed by the petitioner before the 1st respondent is restored to the file of the 1st respondent.

Issues:
1. Assessment order under the Telangana Value Added Tax Act, 2005 for the tax period 2014-15 to 2015-16.
2. Rejection of objections by the 2nd respondent leading to tax confirmation.
3. Lack of personal hearing before passing the assessment order.
4. Appeal filed before the 1st respondent against the 2nd respondent's order.
5. Allegations of denial of natural justice and failure to inform the petitioner about notices by the Auditor.
6. Demand notice, garnishee notice, and subsequent actions by the 3rd and 4th respondents.
7. Rejection of appeal by the 1st respondent without addressing petitioner's contentions.
8. Violation of principles of natural justice and duty of the appellate authority.
9. Decision to remit the matter back to the 1st respondent for a fresh order.
10. Similar contentions in another Writ Petition (W.P.No.9810 of 2020) challenging ADC Order No.1478.

Analysis:
1. The petitioner challenged the assessment order for the tax period 2014-15 to 2015-16 under the Telangana Value Added Tax Act, 2005. The 2nd respondent confirmed the tax amounts, leading to the petitioner filing an appeal before the 1st respondent, alleging lack of personal hearing before the assessment order was passed.

2. The 2nd respondent rejected the objections raised by the petitioner and confirmed significant tax liabilities. The petitioner disputed these findings but was not granted a personal hearing before the assessment order was finalized.

3. The petitioner contended that no personal hearing was provided before the assessment order was passed by the 2nd respondent. The lack of opportunity to present their case raised concerns regarding the adherence to principles of natural justice.

4. The appeal filed by the petitioner before the 1st respondent was rejected without addressing the contentions raised by the petitioner. The petitioner alleged that the Auditor failed to inform them about notices issued by the 1st respondent, leading to a denial of natural justice.

5. The High Court observed that the 1st respondent should have addressed the contentions raised in the appeal filed by the petitioner, irrespective of whether a personal hearing was availed. The duty of the appellate authority to consider all grounds of appeal was emphasized.

6. The Court decided to set aside the orders passed by the 1st respondent and remit the matter back for a fresh order, allowing the petitioner to present any supporting material within a specified timeframe. The importance of upholding principles of natural justice in appellate proceedings was highlighted.

7. A similar issue was raised in another Writ Petition (W.P.No.9810 of 2020) challenging ADC Order No.1478, where the petitioner contested the rejection of the appeal based on the lack of personal hearing and failure to produce supporting evidence.

8. Both Writ Petitions were allowed, setting aside the respective orders and restoring the appeals to the 1st respondent for a fresh decision. The Court emphasized the need for a reasoned order considering all submissions and ensuring compliance with principles of natural justice.

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