2018 (3) TMI 1415 - HC - VAT and Sales Tax

Validity of assessment order - Held that - Having admitted the mistake, the respondent could not have proceeded further, without making proper proposal, he proposed to proceed with the assessment on totally different lines. This mistake committed by the respondent goes to the root of the mater, affecting the very orders of assessment. This is sufficient to hold that the impugned orders are bad in law, as they have exceeded the proposal in the Revision Notices, dated 14.11.2016, and without due application of mind - Petition allowed.

Summary

Issues:
Challenge to assessment orders for multiple assessment years under the Tamil Nadu Value Added Tax Act, 2006 due to exceeding the scope of revision notices.

Analysis:
The petitioner, a registered dealer under the Tamil Nadu Value Added Tax Act, contested assessment orders for several years, alleging that the Assessing Officer exceeded the scope of the revision notices. The assessment orders stemmed from an audit conducted by the Enforcement Wing Officers of the respondent Department. The High Court consolidated all Writ Petitions related to the impugned assessment orders for a joint decision. The Court noted that the Assessing Officer had strayed from the issues highlighted in the revision notices. For instance, in the assessment for 2009-10, the Officer introduced new grounds not mentioned in the revision notice, such as discrepancies in purchase and sales turnovers. This departure from the proposed issues was deemed a fundamental error affecting the validity of the assessment orders.

Upon scrutinizing the impugned assessment orders, the Court found discrepancies in the treatment of purchase turnovers and sales turnovers. Despite acknowledging errors in reporting purchase values, the Assessing Officer proceeded with the assessment without proper justification or revised proposals. This deviation from the original scope outlined in the revision notices was considered a critical flaw, indicating a lack of due diligence and lawful application of mind. Consequently, the Court concluded that the impugned orders were legally flawed and set them aside.

In light of the above findings, the High Court allowed the Writ Petitions and issued specific directions to the respondent. The Court ordered the respondent to issue fresh notices clearly outlining the proposed assessments, granting the petitioner an opportunity to respond and present objections. A 15-day period was provided for submitting objections, followed by a personal hearing before redoing the assessments in compliance with the law. The Court emphasized the importance of adhering to the prescribed procedures and ensuring that assessments are conducted within the defined parameters to uphold the principles of natural justice and procedural fairness.

Ultimately, the Writ Petitions were allowed, and no costs were imposed on either party. The connected Writ Miscellaneous Petitions were closed, bringing the legal proceedings to a conclusion. The judgment underscored the significance of maintaining procedural regularity and adherence to the specified guidelines while conducting assessments under the Tamil Nadu Value Added Tax Act, 2006 to safeguard the rights of the concerned parties and uphold the integrity of the assessment process.