2022 (12) TMI 2 - HC - VAT and Sales Tax

Validity of assessment order - turnover from sale of wind mill - period 2014-15 - opportunity of hearing was granted but was unavailed by the petitioner - principles of natural justice - HELD THAT - The opportunity granted under notice dated 30.07.2019, which is admittedly, the only notice issued to the petitioner prior to finalizing of assessment, does not conform to proper procedure - The respondent calls upon the petitioner to file a written objection to the proposal, which has been done by the petitioner. The notice also states that, if any personal hearing is required , the petitioner may avail the same at 11.00 a.m at any date before the filing of objection. A personal hearing must be afforded specifying the date and time of hearing. That apart, such hearing must be pursuant to the receipt of objections in order that both parties may be fully aware of their respective stands. It is only in such circumstances that a personal hearing can be said to be effective. The impugned order to the extent, to which it has not been assailed in appeal, is set aside, subject to the condition that the petitioner appear before the authority on 24.11.2022. If the petitioner does not avail this opportunity, it is made clear that the benefit of this order will be unavailable to it and the impugned order will stand revived. Petition disposed off.

Summary

Issues:
Challenge to assessment order under Tamil Nadu Value Added Tax Act, 2006 for the period 2014-15; Lack of effective opportunity for petitioner to make submissions prior to completion of assessment; Validity of pre-assessment notice granting opportunity of personal hearing; Requirement of proper procedure for personal hearing; Setting aside impugned order subject to petitioner appearing before the authority.

Analysis:
The judgment concerns a challenge to an assessment order under the Tamil Nadu Value Added Tax Act, 2006 for the period 2014-15. The petitioner had approached the Appellate Authority regarding an issue related to the turnover from the sale of a windmill. The petitioner contended that no effective opportunity was provided to make submissions before the assessment was finalized, emphasizing the lack of a personal hearing. The Government Advocate argued that a pre-assessment notice dated 30.07.2019 had granted an opportunity for a personal hearing, which the petitioner did not avail.

The court observed that the opportunity granted under the said notice did not adhere to proper procedure as it did not specify a date and time for the personal hearing. It was highlighted that a personal hearing should follow the receipt of objections to ensure both parties are fully informed of their positions for an effective hearing. Consequently, the court directed the petitioner to appear before the Authority on a specified date without awaiting further notice, emphasizing the importance of a proper personal hearing process.

The judgment set aside the impugned order, subject to the condition that the petitioner attends the scheduled personal hearing. It was made clear that if the petitioner fails to avail this opportunity, the benefit of setting aside the order would be forfeited, and the impugned order would stand reinstated. The court instructed the Officer to pass an order within four weeks from the date of the personal hearing, thereby ensuring timely resolution of the matter. The writ petition was disposed of with no costs, and the connected miscellaneous petition was closed, concluding the legal proceedings in this case.