2018 (2) TMI 755 - HC - VAT and Sales Tax

Principles of natural justice - main contention of appellant is that neither in the assessment order nor while passing orders on the applications filed seeking rectification, the Assessing Authority has applied its mind to the various materials placed before it and the request made seeking exemption against the labour charges, sales effected outside the State, TDS input tax, etc. - Held that - the authorities do not refer to the documents said to have been produced by the appellant/assessee before the Assessing Authority at different intervals - By relying upon the original records, learned High Court Government Pleader has vehemently contended that no such documents were produced by the appellant. Question whether any such document had been indeed produced and how it had any bearing on the merits of the matter is itself a disputed question which we cannot go into in exercise of the power under Articles 226 & 227 of the Constitution of India. Appellant ought to have filed an appeal challenging the assessment order. An opportunity has to be provided to the appellant to file an appeal against the re-assessment order taking up all legal contentions open to him. Appeal disposed off.

Summary

Issues:
1. Dismissal of writ petitions and review petitions challenging re-assessment orders.
2. Allegation of lack of fair opportunity to present case.
3. Failure to consider documents submitted by the appellant.
4. Legal contentions regarding the assessment order and rectification applications.
5. Granting opportunity to file an appeal against the re-assessment order.
6. Requirement of statutory deposit under the Karnataka Value Added Tax Act, 2003.

Issue 1: Dismissal of Writ Petitions and Review Petitions:
The appellant filed writ petitions challenging the re-assessment order passed by the respondent, alleging lack of fair opportunity to present his case. The Single Judge dismissed the writ petitions, stating that the appellant did not utilize the opportunities provided to participate in the inquiry. Subsequently, the appellant also challenged the order dismissing the review petitions. This led to the filing of an Intra-Court Appeal against the said orders.

Issue 2: Allegation of Lack of Fair Opportunity:
The appellant contended that the re-assessment order was passed without serving a proposition notice and that his applications for rectification were rejected without providing a proper opportunity. The appellant argued that despite submitting relevant documents, the authority proceeded to reject the rectification requests without considering the merits of the case. The appellant claimed that there was no fair and reasonable opportunity given to him to present his side of the matter.

Issue 3: Failure to Consider Submitted Documents:
The High Court noted that the Assessing Authority did not refer to the documents submitted by the appellant at different intervals. The appellant claimed to have enclosed various registers and certificates with the rectification applications, but the authorities allegedly did not consider these documents. The court observed that the existence and relevance of these documents could not be verified under Article 226 & 227 of the Constitution of India, as it required a factual determination beyond the scope of the court's jurisdiction.

Issue 4: Legal Contentions and Rectification Applications:
The main contention raised by the appellant's Senior Counsel was that the Assessing Authority did not apply its mind to the materials provided by the appellant, including requests for exemption against specific charges and taxes. The High Court Government Pleader supported the authority's actions. The court emphasized that the appellant should have appealed against the assessment order instead of solely seeking rectification, despite the delay in presenting the appeal.

Issue 5: Granting Opportunity to File an Appeal:
In consideration of the ends of justice, the court granted the appellant 30 days to file an appeal against the re-assessment order, allowing him to raise all legal contentions available. The court directed the appellant to deposit a specified amount within 30 days before the Assessing Authority to proceed with the appeal without time limitation issues. The appellant was also permitted to submit additional documents for consideration during the appeal process.

Issue 6: Statutory Deposit Requirement:
The court ordered the appellant to deposit a sum representing 30% of the demand made under the Karnataka Value Added Tax Act, 2003, within 30 days. The receipt of this deposit was to be produced before the Appellate Authority. The court clarified that the Appellate Authority should evaluate the case based on merits without being influenced by previous orders rejecting rectification applications.

In conclusion, the Writ Appeals were disposed of, granting the appellant an opportunity to file an appeal against the re-assessment order while complying with the statutory deposit requirements.