2021 (3) TMI 958 - HC - VAT and Sales Tax

Principles of Natural Justice - the respondent has not at all considered the materials from an independent perspective - petitioner's stand was rejected and the proposals set out in the show cause notices were confirmed - HELD THAT - The petitioner has projected his defence in the replies. Along with the notices, documents have also been enclosed. The petitioner's counsel would further claim that when the personal hearing took place, the documents were produced. But his core argument is that the respondent did not independently apply his mind. The petitioner's counsel would strongly contend that the respondent though a quasi judicial officer chose to go-by the stand of the Enforcement Wing Officials - The assessing authority chose to overrule all the objections of the petitioner as untenable in a single line. It is obvious that the respondent has not at all considered the materials from an independent perspective. The respondent has merely reproduced the stand of the Enforcement Wing Officials and has not dealt with the issue independently. A learned Judge of this Court in AMUTHA METALS VERSUS COMMERCIAL TAX OFFICER, MANNADY (EAST) ASSESSMENT CIRCLE, CHENNAI 2007 (3) TMI 677 - MADRAS HIGH COURT held that if the reasoning stated by the Enforcement Officials is taken as correct reason, there is no need for the assessing officer to be there to frame the assessment. The Enforcement Wing Officials themselves would have framed the assessment - Under the statutory provisions, it is expected from the assessing officer to consider the objections and either accept or reject the same by giving valid reasons by applying his mind. This approach has not at all been adopted in the case on hand. The matter is remitted to the file of the respondent to pass orders afresh in accordance with law - Petition allowed by way of remand.

Summary

Issues:
Assessment deemed concluded under Section 22(2) of TNVAT Act, discrepancies noticed during inspection, pre-revision notices issued, rejection of petitioner's stand, maintainability of writ petitions due to alternative remedy of appeal.

Analysis:
The petitioner, a dealer in computer peripherals, was assessed for the years 2014-15, 2015-16, and 2016-17 under the TNVAT Act. Following an inspection by Enforcement Wing Officers revealing discrepancies, the respondent issued pre-revision notices for all three assessment years. The petitioner provided explanations and attended personal hearings, but the respondent rejected the petitioner's stand, leading to the challenge of the impugned orders through writ petitions.

The respondent contended that the petitioner failed to produce records during the personal hearing to substantiate the defense and argued that the writ petitions were not maintainable due to the availability of an alternative remedy of appeal. The court carefully considered the contentions and reviewed the replies submitted by the petitioner to the show cause notices.

The petitioner defended the case by submitting documents along with the notices and claimed that the respondent did not independently consider the defense presented. The court observed that the respondent relied solely on the Enforcement Wing Officials' stand without applying independent judgment, which is essential in a quasi-judicial role. The court emphasized that the assessing authority must assess objections independently and provide valid reasons for accepting or rejecting them.

Referring to a previous judgment, the court highlighted the necessity for the assessing officer to consider objections independently and not merely reproduce the Enforcement Wing's stance. As a result, the court quashed the impugned orders in the writ petitions, remitting the matter back to the respondent for fresh orders in accordance with the law. The writ petitions were allowed, and no costs were imposed, concluding the case.