2013 (4) TMI 354 - HC - VAT and Sales Tax

Cancellation of Registration - Procedure for registration U/s 39 - Held that - The authority has not at all followed the procedure prescribed under Sub Sections 14 and 15 of Section 39 of the Act in giving an opportunity of hearing to the dealer before cancelling the certificate of registration. It is the cardinal principle that any authority, who is vested with quasi judicial function, should mandatorily comply with the procedure contemplated under the relevant Act and any violation against such procedure can be termed as violation of the principles of natural justice. The impugned order, being one passed in violation of the principles of natural justice, is unsustainable and is accordingly quashed - The matter is remanded back to the respondent with liberty to the respondent to proceed afresh by affording an opportunity of hearing to the petitioner and then proceed further to pass appropriate orders in accordance with law within a period of four weeks from the date of receipt of a copy of this order - The writ petition stands allowed with the above directions - Connected miscellaneous petition is closed.

Summary

Issues:
Challenge to order of cancellation of Sales Tax Registration under Tamil Nadu Value Added Tax Act, 2006 and Central Sales Tax Act without opportunity of hearing.

Analysis:
The petitioner, a registered dealer in Iron and Steel, challenged the cancellation of Sales Tax Registration by the respondent, alleging that the cancellation was done without providing an opportunity to represent the case. The petitioner contended that the cancellation caused hardship and legal problems. The revisional authority remanded the issue back to the Assistant Commissioner without giving the petitioner a chance to present their case. The respondent cited that the place of business was not suitable for trading iron and steel, leading to the cancellation of registration.

The Court analyzed the provisions of Section 39 of the Tamil Nadu Value Added Tax Act, emphasizing that the authority must follow a strict procedure before canceling a certificate of registration. The Act mandates that the dealer must be given an opportunity to be heard before any decision is made regarding the registration. The Court held that the authority failed to adhere to the prescribed procedure, violating the principles of natural justice. As a result, the impugned order was quashed, and the matter was remanded back to the respondent with directions to provide the petitioner with an opportunity for a hearing and to pass appropriate orders within four weeks.

In conclusion, the Court allowed the writ petition, emphasizing the importance of following due process and providing a fair opportunity for the dealer to present their case. The judgment highlighted the necessity for authorities to comply with the procedures outlined in the relevant Act to ensure justice and fairness in administrative decisions.