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2016 (6) TMI 342 - HC - VAT and Sales TaxSeeking acceptance of requisite declarations in Form F - Violation of principles of natural justice - while levying tax at the rate of 5% on the turnover of ₹ 53,99,88,582/-, the respondent had wrongly imposed at ₹ 7,69,99,429/- instead of correct amount of ₹ 2,69,99,429/- - patently a clerical and calculation error - Held that - in the light of the order passed by this Court in the case of State of Tamil Nadu Versus Arulmurugan and Company 1982 (11) TMI 143 - MADRAS HIGH COURT , following the Full Bench s Judgment of this Court also the circular dated February 1, 2000 issued by the Commissioner of Commercial Taxes, Chennai, the impugned orders are set aside and respondents are directed to accept form F filed by the petitioner for the assessment year 2014-2015 and pass orders afresh in accordance with law. - Decided in favour of petitioner
Issues:
1. Jurisdiction and authority of law in tax assessment 2. Principles of natural justice in assessment process 3. Correct calculation of tax amount 4. Requirement of personal hearing before final assessment 5. Application of circulars and judgments in tax assessments Issue 1: Jurisdiction and authority of law in tax assessment The petitioner, a Limited Company, challenged the tax assessment issued by the respondent under the TNVAT Act 2006 and CST Act 1956. The petitioner contended that the assessment was without jurisdiction and authority of law. The petitioner argued that the respondent had wrongly imposed tax on the exempted turnover without granting an opportunity for a personal hearing, which the petitioner claimed was a mandatory requirement under Section 22(4) of the TNVAT Act 2006. The petitioner sought for the quashing of the assessment and for fresh orders to be passed. Issue 2: Principles of natural justice in assessment process The petitioner highlighted the importance of principles of natural justice in the assessment process. The petitioner alleged that the respondent failed to provide a personal hearing before passing the final assessment order, which the petitioner believed was a violation of natural justice. The petitioner emphasized that the opportunity for personal appearance was crucial before levying tax, especially on exempted turnover. The petitioner sought a fair assessment process in accordance with the principles of natural justice. Issue 3: Correct calculation of tax amount The petitioner raised concerns regarding the calculation error in the tax amount imposed by the respondent. The petitioner argued that the respondent had erroneously levied a higher tax amount than the correct figure. The petitioner pointed out this clerical and calculation error and submitted an application for fresh assessment, requesting the acceptance of requisite declarations in Form F to rectify the mistake. The petitioner sought a correct calculation of the tax amount in line with the actual turnover. Issue 4: Requirement of personal hearing before final assessment The petitioner emphasized the necessity of a personal hearing before finalizing the assessment. The petitioner awaited a personal hearing to provide the requisite forms supporting the claim for exemption. However, the respondent passed the final orders without granting the petitioner the opportunity for personal appearance. The petitioner argued that the absence of a personal hearing deprived them of a fair chance to present their case and fulfill the necessary requirements for exemption. Issue 5: Application of circulars and judgments in tax assessments The judgment referred to a similar case where the court allowed a writ petition based on a circular issued by the Commissioner of Commercial Taxes and a Full Bench judgment. The court directed the respondent to accept the form filed by the petitioner and pass fresh orders in accordance with the law. The court applied the principles established in previous judgments and circulars to ensure a fair assessment process. The court relied on legal precedents and circulars to guide the assessment procedure and uphold the rights of the petitioner in tax matters.
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