1971 (3) TMI 102 - HC - VAT and Sales Tax

Summary

Issues:
Assessment based on despatches of synthetic diamonds, failure to consider returned parcels, duty of postal authorities to furnish information, violation of natural justice in assessment proceedings.

Analysis:
The case involved six connected writ petitions concerning the assessment of a dealer in synthetic diamonds by the Joint Commercial Tax Officer. The dealer's business practice included sending packets of synthetic diamonds to prospective buyers outside the State, raising invoices upon approval, and following Central Sales Tax Act procedures. The issue arose when the Tax Officer proposed an assessment based on despatches without considering returned parcels, potentially resulting in an incorrect tax liability. The dealer sought a writ of mandamus against the Tax Officer and postal authorities for failing to assist in obtaining relevant information for the assessment.

The contention centered on the duty of the postal authorities to furnish information regarding articles sent and returned by the dealer. The postal department cited rule 17, which restricts the disclosure of post office records to individuals not belonging to the department. However, an exception allowed the Tax Officer, empowered under the Tamil Nadu General Sales Tax Act, to summon postmasters for information necessary for assessment proceedings. As the Tax Officer had the authority to issue summons and secure information, the court discharged the rule nisi against the postal authorities.

Regarding the Tax Officer, the court noted no failure of public duty as no summons application had been made. However, the dealer argued that principles of natural justice required providing an opportunity to access all relevant information for a fair assessment. Acknowledging the quasi-judicial nature of assessment proceedings, the court emphasized the importance of a fair trial and full opportunity for the assessee. Instead of making the rule nisi absolute, the court issued directions to facilitate the completion of assessment and enable the dealer to obtain necessary information from the postal authorities.

In conclusion, the court dismissed the writ petitions against both respondents but provided directions to the Tax Officer to summon the postmaster for information on articles sent and returned by the dealer. The dealer was instructed to furnish a list of such articles within six weeks, with costs incurred for obtaining information to be borne by the dealer. The court emphasized the importance of fair assessment procedures and the right of the dealer to access relevant information for a just outcome.