2021 (5) TMI 325 - HC - VAT and Sales Tax

Validity of assessment order - recovery action - non-compliance of the condition stipulated while granting interim order - HELD THAT - This Court had made it clear that if the petitioners failed to pay 25% of the demand amount, interim stay shall stand automatically vacated and petition shall stand automatically dismissed - Therefore, the consequence of non-compliance of the condition stipulated while granting interim order will be only on the interim application. It will not cast any cloud for availing relief that may be finally claimed by the writ petitioners. I will not non-suit the petitioners on the ground of non-fulfilment of the condition imposed while granting interim relief. Going into the merits of the matter, it is seen that there are two assessment years involved. The petitioners had challenged only the assessment order dated 30.09.2003 in respect of the assessment year 1997-98. Though the other assessment order was passed on the same day, in the present writ petition, there is no formal challenge to the same - it would be appropriate if the petitioners file an independent writ petition questioning the other assessment orders made for the assessment year 1998-99. Validity of the assessment order - HELD THAT - The assessing officer should have served notice on the three legal heirs. It appears that the marriage of the petitioners herein had taken place long prior to the assessments and that they had left for their respective marital homes. The assessing officer does not appear to have been taken the trouble to ascertain the details regarding all the legal representatives. The assessing officer thought that it was enough if Subbulakshmi alone was served with notice. It appears that Subbulakshmi was an illiterate woman. The petitioners herein were not parties to the said assessment proceedings that were concluded in the year 2003 - In the case on hand there is nothing on record to indicate that the petitioners herein had accepted the representation of the estate of Late. Velusamy Konar by his wife Subbulakshmi. It is for this reason that I am constrained to interfere with the order impugned in this writ petition. 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 of a dealer for the years 1997-98 and 1998-99, non-compliance with interim order, challenge to recovery action, property attachment, validity of assessment order, application of Section 15 of the Tamil Nadu General Sales Tax Act, 1959, service of notice on legal representatives, representation of estate by multiple legal heirs.

Assessment of Dealer:
The judgment concerns the assessment of a dealer named Velusamy Konar for the years 1997-98 and 1998-99. After discrepancies were noticed during an inspection, assessments were finalized in 2003, following Velusamy Konar's passing. His wife, Subbulakshmi, was treated as the legal representative. A writ petition challenging recovery actions was filed after Subbulakshmi's demise in 2017.

Non-Compliance with Interim Order:
The petitioners failed to comply with the interim order requiring payment of 25% of the demand amount. Despite the Special Government Pleader's argument for dismissal due to non-compliance, the judge decided not to dismiss the writ petition solely based on this ground, as the consequence would only affect the interim application.

Property Attachment and Validity of Assessment Order:
The judge noted that the property in question belonged to Subbulakshmi, not Velusamy Konar. The recovery officer was directed to ensure that only properties belonging to the deceased were proceeded against. The validity of the assessment order from 2003 was questioned, with the judge highlighting the need for notice to all legal representatives as per Section 15 of the Tamil Nadu General Sales Tax Act, 1959.

Service of Notice on Legal Representatives:
The judge found that notice should have been served on all three legal heirs, not just Subbulakshmi. The assessing officer's failure to ascertain details regarding all legal representatives was noted. The judge referred to a Supreme Court decision emphasizing the importance of substantial representation of the estate by all legal representatives.

Representation of Estate by Multiple Legal Heirs:
Given the lack of evidence showing acceptance of representation by Subbulakshmi alone, the judge decided to interfere with the impugned order. The petitioners undertook to pay a specified sum towards the dues of Velusamy Konar, leading to the quashing of the impugned orders and remittance of the matter back to the respondent for fresh orders.

This detailed analysis of the judgment provides insights into the various legal issues addressed, including assessment procedures, compliance with court orders, property attachments, validity of assessment orders, service of notice on legal representatives, and representation of estates by multiple legal heirs.