2018 (9) TMI 552 - HC - VAT and Sales Tax

Principles of natural justice - validity of assessment order - the impugned orders of assessment were passed without affording sufficient opportunity to the petitioner to place their objections with materials documents - assessment years 2011-2012 to 2015-2016 - Held that - Apart from these five assessment years, notice of proposal were sent to the petitioner in respect of the other three assessment years viz., 2009-2010, 2010-2011 and 2016-2017. It is not in dispute that the petitioner had given their reply to those three assessment years and it is stated that based on such reply, a deviation proposal is sent by the Assessing Officer. Considering the fact that the petitioner had already participated in the assessment proceedings in respect of those three assessment years, by filing their reply, I do not think that any attempt is being made by the petitioner to drag the proceedings insofar as these five assessment years are concerned, as they only want further time to file their reply, since they have to collect voluminous documents in support of their reply - such request is considered as genuine. Penalty - Section 27(3) of the TNVAT Act, 2006 - Held that - It is true that the petitioner has not given any reply to the notice before conclusion of the assessment. But, at the same time, perusal of the impugned orders insofar as the imposition of penalty portion is concerned, would show that no reasons or findings are given as to how the Assessing Officer is satisfied to impose the penalty on the petitioner. The assessment orders are totally silent on that aspect - In the absence of any justifiable reasons stated for imposition of penalty, this Court is of the view that the matter has to go back to the Assessing Officer to consider the issue afresh and pass fresh orders of assessment on merits and in accordance with law. Petition allowed by way of remand.

Summary

Issues:
Challenging assessment orders for 2011-2012 to 2015-2016, violation of natural justice in assessment, imposition of penalty without hearing, request for time to collect documents, participation in assessment proceedings for other years, lack of reasons for penalty imposition.

Analysis:
The writ petitions challenge assessment orders for the years 2011-2012 to 2015-2016. The petitioner argues that they were not given sufficient opportunity to present objections with necessary documents. They claim the Assessing Officer imposed penalties without a hearing, violating principles of natural justice. The petitioner had filed replies for other assessment years, showing willingness to participate in the process. They request more time to collect voluminous documents for the current assessment years.

The respondents argue that the petitioner had multiple opportunities to respond to proposals but failed to do so. They contend that the Assessing Officer acted appropriately based on available information. Regarding penalties, the respondents state that the proposals included penalty notices, and it was the petitioner's responsibility to respond.

The Court notes the dispute covers five assessment years and acknowledges the petitioner's active participation in assessment proceedings for three other years. The Court finds the petitioner's request for additional time to gather documents reasonable. Regarding penalties, the Court observes that the assessment orders lack reasoning for imposing penalties, emphasizing the need for justifiable reasons and a hearing before penalty imposition.

Consequently, the Court allows the writ petitions on specific terms. The assessment orders are set aside, and the matter is remitted to the Assessing Officer for fresh assessment. The petitioner is granted six weeks to submit replies with documents and must pay 10% of the tax liability for each year. The Assessing Officer is directed to conduct a personal hearing, followed by fresh assessment orders within six weeks. Any payments made will be adjusted post-assessment. No costs are awarded, and related petitions are closed.