2019 (3) TMI 1413 - HC - VAT and Sales Tax

Validity of assessment order - bast judgement assessment - TNVAT Act - case of the appellant is that the Assessing Officer, without conducting any independent enquiry, merely went by the proposal of the officials of the Enforcement Wing, which amounted to abdication of his statutory duty as an Assessing Officer - Held that - It is to be noted that though the assessments were completed in the year 2015/2017, the respondent has not been able to recover a single pie towards tax or penalty and the assessment orders remained as paper orders - That apart, the revision of assessment was based upon a report submitted by the officials of the Enforcement Wing. Hence, we are of the considered view that an opportunity can be granted to the appellant to put forth their contentions, since already the appellant remitted tax along with their returns, as the allegation is stock difference. The orders dated 19.12.2018 passed in the said writ petitions are modified by directing the appellant to pay 15% of the tax demanded for each of the assessment years within three weeks from the date of receipt of a copy of this judgment - appeal disposed off.

Summary

Issues: Appeal against assessment orders under the Tamil Nadu Value Added Tax Act, 2006 for the years 2011-12, 2014-15, 2015-16, and 2016-17. Challenge of assessments completed on best judgment basis due to non-filing of objections to revision notices. Allegations of failure to maintain input tax credit records and stock differences. Appellant's contention of lack of independent inquiry by Assessing Officer. Failure to submit replies to revision notices. Imposition of penalty and equal time addition. Single Judge's directive to pay 50% of tax liability for certain years. Dismissal of writ petition for 2011-12 assessment order due to delay. Recovery issues and lack of recovery by respondent. Opportunity for appellant to present contentions. Consideration of dealer's status as a small cashew nuts dealer in Cuddalore District.

Analysis:
The appellant, a registered dealer under the Tamil Nadu Value Added Tax Act, challenged assessment orders for multiple years based on best judgment due to non-filing of objections to revision notices. Allegations included failure to maintain input tax credit records and stock differences, leading to assessments without independent inquiry. The appellant cited precedents to support their case, emphasizing the Assessing Officer's duty. The appellant also argued that failure to reply to revision notices was due to the clerk's negligence, requesting no penalty imposition.

The Single Judge faulted the appellant for not appealing and directed payment of 50% of tax liability for specific years. The writ petition for the 2011-12 assessment was dismissed due to delay. However, the respondent failed to recover any tax or penalty despite the assessments. Considering the Enforcement Wing's report as the basis for revision, the court granted the appellant an opportunity to present contentions, noting the appellant's compliance with tax remittance. The court highlighted the appellant's status as a small cashew nuts dealer in Cuddalore District, emphasizing the need for a fair opportunity in the assessment process.

The final judgment modified the earlier orders, directing the appellant to pay 15% of the tax demanded for each year within a specified period. Compliance would allow the appellant to submit objections, receive a personal hearing, and have assessments redone. Until the fresh assessments were completed, no further tax or penalty would be demanded. Failure to comply would result in automatic dismissal of the appeals. The court closed the case without costs, ensuring the benefit of the order hinged on the appellant's adherence to the specified conditions within the stipulated timeframe.