2017 (10) TMI 182 - HC - VAT and Sales Tax

Validity of assessment order - power of Special Committee to reject an application - application rejected on the ground that petitioner did not appear for several hearings - Section 16-D of the Tamil Nadu General Sales Tax Act, 1959 - Held that - it is evidently clear that the reason for rejection is utterly perverse. The Special Committee has no jurisdiction to comment upon the observation made by the High Court in the earlier writ petitions and the expressions used in the impugned order are condemnable. The Special Committee did not appreciate the observations made by this Court as to what is the power conferred on it u/s 16-D of the TNGST Act. Without reading the order passed by the High Court, the Special Committee, in a most arbitrary and perverted manner, has passed the impugned order - none of the three members of the Special Committee had applied their mind to the observations contained in paragraph-2 of the order passed in the earlier writ petitions. Under normal circumstances, when proceedings are quashed on such a ground, the matter would be remanded to the same authority for fresh consideration. However, in these cases, this Court does not propose to adopt such a procedure as in spite of an earlier direction, the Special Committee has failed to take into consideration of the merits of the matter. The order passed by the Special Committee impugned in these writ petitions are set aside. Consequently, the orders of assessment passed by the second respondent for the assessment years 2004-2005 and 2005-2006 under the TNGST Act dated 27.04.2009 and 29.04.2009 are set aside and the matter is remanded back to the second respondent for fresh consideration - petition allowed by way of remand.

Summary

Issues:
Challenging the order passed by the Special Committee under Section 16-D of the Tamil Nadu General Sales Tax Act, 1959 for assessments in 2004-2005 and 2005-2006.

Analysis:
The petitioner challenged the Special Committee's rejection of their applications seeking clarification on assessments for the mentioned years. The assessing officer identified defects and omissions in the petitioner's accounts, leading to a revision notice proposing to revise the turnover. Despite a deviation proposal suggesting no need for revision, the Joint Commissioner directed reassessment, resulting in orders in 2009. The petitioner approached the Special Committee, which initially rejected their petitions, but a court order remanded the matter for fresh consideration due to procedural irregularities.

The High Court found the Special Committee's rejection reasons to be baseless and beyond its jurisdiction. The Committee failed to understand its powers under Section 16-D of the Act, as highlighted in the court's previous order. The court emphasized the Committee's duty to address issues raised by petitioners and provide reasoned decisions. The court noted the Committee's failure to consider its previous observations, leading to irresponsible conclusions in the impugned order. Due to the Committee's persistent oversight, the court decided to quash both the Committee's order and the assessment orders.

Consequently, the High Court set aside the Special Committee's order and the assessment orders for the years in question. The matter was remanded to the assessing officer for fresh consideration, emphasizing an independent assessment without influence from external reports or directives. The court aimed to ensure a fair and unbiased reassessment process, directing the assessing officer to conduct a thorough review based solely on the materials presented. The court's decision aimed to uphold justice and procedural fairness in the assessment process, concluding the writ petitions in favor of the petitioner without imposing any costs.