2019 (2) TMI 129 - HC - VAT and Sales Tax

Principles of natural justice - validity of assessment order - it is the case of petitioner is that the reply submitted by the petitioner dated 17.09.2018 was not considered or taken into account by the Assessing Officer before passing the impugned orders of assessment on 28.09.2018 - Held that - This Court at this stage is not expressing any view on the merits of the assessment, since the only ground on which, those orders are sought to be challenged is in violation of principles of natural justice. Therefore, this Court has to consider as to whether such violation has taken place or not. This Court is inclined to grant one more opportunity to the petitioner to put forth their case before the Assessing Officer, however, subject to the condition that the petitioner pays 10% of the tax liability so as to show their bona fide for the purpose of making the assessment orders afresh, on merits and in accordance with law - matter is remitted back to the Assessing Officer - Petition allowed by way of remand.

Summary

Issues: Violation of principles of natural justice in assessment orders

Detailed Analysis:
1. The petitioner challenged assessment orders for the years 2011-2012 to 2015-2016, alleging violation of principles of natural justice. The petitioner claimed that their reply was not considered before passing the orders and that no personal hearing was afforded.

2. The respondent argued that the petitioner did not respond within the stipulated time after receiving the notice of proposal. It was contended that the petitioner failed to utilize the opportunity for a personal hearing as mentioned in the notice.

3. The Court noted that the petitioner's Accountant, who received the notice, passed away, leading to a delay in filing the reply. However, the Assessing Officer did not receive the reply, even though a copy was included in the documents.

4. The Assessing Officer concluded the assessment solely based on the absence of a reply from the petitioner, without considering the merits of the case. The respondent's argument that the opportunity for personal hearing was given was deemed insufficient by the Court.

5. The Court emphasized that a genuine personal hearing should involve both parties debating the issue effectively. Therefore, it directed the petitioner to pay 10% of the tax liability for each year and present their case before the Assessing Officer for fresh assessment orders.

6. The Court allowed the writ petitions, setting aside the assessment orders and remitting the matter back to the Assessing Officer with specific conditions for a fair assessment process. Failure to comply with the conditions would result in the restoration of the original assessment orders.