2018 (11) TMI 61 - HC - VAT and Sales Tax

Validity of revised order - revised order came to be passed for the assessment year 2017-18, even before the very expiry of the assessment year, ie., 31.03.2018 and without completing the original order of assessment - principles of natural justice. Held that - It is not in dispute that the petitioner has received the show cause notice, but did not file their objections. Even otherwise, it is mandatory on the part of the respondent to post the matter for personal hearing. As per the circular issued by the Head of the Department, pursuant to the recommendations issued by the Justice Ramanujam Committee, it is mandatory to give an opportunity of personal hearing, by specifying the dates of such personal hearing, whether it is asked or not by the petitioner. This Court is of the view that the matter should be remanded for fresh consideration - Petition allowed by way of remand.

Summary

Issues:
Challenging revised assessment order for the assessment year 2017-18 passed before the expiry of the assessment year without completing the original order of assessment under Section 22 of the Tamil Nadu Value Added Tax Act, 2006. Lack of opportunity of personal hearing before passing the impugned order.

Analysis:
The petitioner, a dealer in ceramic tiles, challenged a revised assessment order for the assessment year 2017-18 passed by the respondent before the expiry of the assessment year without completing the original assessment order as required by Section 22 of the Tamil Nadu Value Added Tax Act, 2006. The petitioner contended that they were not provided with an opportunity of personal hearing before the impugned order was passed, citing a notice received on 06.03.2018 and the ill health condition of the sole proprietor hindering an immediate response. The petitioner sought relief through the writ petition.

The respondent, represented by the learned Additional Government Pleader, argued that the petitioner was issued a show cause notice on 06.03.2018 but failed to respond, leading to the passing of the impugned order on 28.03.2018. It was emphasized that the impugned order was appealable, and the petitioner should have pursued an appeal instead of resorting to a writ petition. The respondent sought dismissal of the writ petition.

Upon hearing both parties, the Court noted that the petitioner did receive the show cause notice but did not file objections. The Court highlighted that it is mandatory for the respondent to provide an opportunity for personal hearing, as per the circular issued by the Head of the Department, even if not requested by the petitioner. The Court observed a lack of mention regarding personal hearing in the impugned order, contravening the established practice.

Citing a relevant unreported decision of a Division Bench, the Court emphasized that failure to submit objections to a pre-assessment notice does not justify denying the assessee an opportunity for personal hearing. Consequently, the Court decided to remand the matter for fresh consideration, setting aside the impugned order and directing the respondent to reevaluate the case.

The Court directed the petitioner to submit objections within two weeks of receiving the order, following which the respondent must schedule a specific date for a hearing within two weeks and communicate it to the petitioner in advance. The petitioner was instructed to appear before the respondent, present their contentions, and cooperate in the enquiry. The respondent was mandated to pass appropriate orders purely on merits within four weeks after the hearing, with a warning that non-cooperation from the petitioner would be duly recorded.

Ultimately, the writ petition was allowed, and no costs were imposed. The connected miscellaneous petition was closed as a consequence of the judgment.