2018 (8) TMI 302 - HC - VAT and Sales Tax

Principles of Natural Justice - Held that - This Writ Petition can be conveniently disposed of by accepting the alternate and without prejudice proposal of the respondents. While accepting that alternate request and without prejudice proposal, we clarify that we have not endorsed any of the pleas of the petitioners as raised in the petition - Whether it was a calculation or arithmetical mistake or otherwise or is an attempt to reopen a completed assessment, will have to be determined by the Assessing Officer, but before he decides and determines it, he must comply with the principles of natural justice - Petition disposed off.

Summary

Issues:
Challenge to assessment order for the Assessment year 2013-2014 based on Stock Transfers to Daman Unit; Reluctance of the court to interfere in Writ jurisdiction due to availability of alternate remedies under MVAT Act; Alleged arithmetical mistake in assessment leading to incorrect tax calculation; Request for correction of the mistake and principles of natural justice.

Analysis:
1. The Writ Petition contested an assessment order for the Assessment year 2013-2014 concerning Stock Transfers to the Daman Unit. The court expressed reluctance to intervene in Writ jurisdiction due to the availability of alternative remedies under the MVAT Act, emphasizing the need to exhaust those remedies before seeking relief through a Writ Petition.

2. The petitioner highlighted an alleged arithmetical mistake in the assessment process, leading to an incorrect tax calculation. The authorized representative of the petitioner acknowledged the mistake, attributing it to inadvertence during computation. The petitioner notified the assessment officer about the error before finalization, seeking an opportunity to explain and correct the mistake.

3. The respondent argued against entertaining Writ Petitions challenging assessment orders based on clerical errors, expressing concerns about setting a precedent for reopening assessments without following statutory procedures. However, the respondent proposed granting a personal hearing to the petitioner's representative solely on the issue of Stock Transfer to address any grievances regarding the alleged mistake.

4. The court accepted the respondent's proposal without prejudice, emphasizing the importance of complying with principles of natural justice in addressing the alleged arithmetical mistake. The court clarified that the acceptance of the proposal did not signify endorsement of the petitioner's claims or conclusions, leaving the determination of the mistake and its rectification to the Assessing Officer while ensuring a fair process with reasons provided for decisions.

5. The court directed the petitioner to approach the Assessing Officer to address contentions raised in the Writ petition specifically related to Stock Transfers, emphasizing that all grounds and arguments on this issue should be considered afresh without influence from prior conclusions. The court clarified that its decision was based on the unique circumstances of the case and should not be considered a precedent, leaving the larger issue of maintainability open for future cases.

In conclusion, the judgment focused on the need to exhaust alternate remedies under the MVAT Act before resorting to Writ jurisdiction, addressed the alleged arithmetical mistake in assessment through principles of natural justice, and directed a fair reconsideration of the Stock Transfer issue by the Assessing Officer.