2019 (6) TMI 1314 - HC - VAT and Sales Tax

Principles of natural justice - It is the specific case of the writ petitioner that the respondent should have sent a response rescheduling/refixing the personal hearing - HELD THAT - In the light of paragraph 3(a)(i) of the aforesaid circular, which is admittedly binding on the respondent, this Court is unable to accept this submission as it is imperative that the respondent should have responded to the request for adjournment, which was made well within the 15 days stipulated in Paragraph 3(a)(i) of the circular. Therefore, the inevitable sequitur that follows is that there was no personal hearing, which is a prescribed procedure and therefore, there is violation of NJP. The impugned orders set aside solely on the ground of violation of NJP i.e., personal hearing, which is a prescribed procedure, not being given - petition disposed off.

Summary

Issues: Violation of natural justice principles in assessment orders under TNGST Act pre-VAT regime.

In this judgment, the court dealt with three writ petitions challenging original assessment orders made by the respondent under the Tamil Nadu General Sales Tax Act, 1956 (TNGST Act) for the assessment years 2002-03, 2004-05, and 2005-06. The key contention raised by the writ petitioner was the violation of natural justice principles (NJP) due to the absence of a personal hearing. The court noted that the writ petitioner had promptly raised preliminary objections upon receiving the notice inviting objections and had requested a personal hearing. However, the respondent fixed the personal hearing on short notice, providing only one working day between the date of receipt of the notice and the hearing. Despite the writ petitioner's request for an adjournment, the respondent proceeded to pass the impugned orders without responding to the request. The court emphasized the importance of complying with NJP and highlighted a circular that mandated responding to such requests within a specified time frame.

The court found that the respondent's failure to respond to the writ petitioner's request for adjournment within the stipulated time period constituted a violation of NJP. Consequently, the court set aside the impugned orders solely on the ground of this procedural irregularity, without delving into the merits of the case. The court directed a fresh personal hearing to be conducted, where the writ petitioner would be required to submit final objections along with supporting documents. Following the personal hearing, the respondent was instructed to redo the assessment and issue fresh assessment orders within six weeks. The court ordered the communication of the fresh assessment orders to the writ petitioner in accordance with the relevant rules. The judgment concluded by disposing of the three writ petitions with the specified directions, without imposing any costs on either party.