2020 (10) TMI 860 - HC - VAT and Sales Tax

Principles of Natural Justice - case of petitioners is that that the Assessing Officer, who is a Quasi Judicial Authority, has not independently applied his mind while dealing with the impugned proceedings, but had adopted the averments and proposals of the Enforcement Wing/ISIC Authorities, who are their higher authorities - HELD THAT - In view of the Circular No.3 dated 18.01.2019 issued by the Commissioner of State Tax, Chennai, all the impugned proceedings in these batch of Writ Petitions, which proceeds on the basis of the proposals/reports of the Enforcement Wing/ISIC, are set aside and consequently, the matters are remanded back to the Assessing Officer. The Assessees are granted liberty to file their objections with all supporting documents, within a period of 30 days from the date of receipt of a copy of this order. On receipt of such objections, the Assessing Officer shall extend due opportunity of personal hearing to the Assessee/Representatives, if necessary through Video Conferencing and endeavor to conclude the assessment proceedings, atleast within a period of 12 weeks from the date of receipt of the objections. Petition allowed.

Summary

Issues Involved:
Common issue of Assessing Officer's independence in dealing with impugned proceedings based on Audit Reports/Inspection Proposals from higher authorities.

Analysis:
The judgment addresses the common issue in all Writ Petitions where petitioners challenge proceedings based on Enforcement Wing or ISIC Authorities' proposals. Petitioners argue that Assessing Officer, a Quasi Judicial Authority, did not independently consider the proposals but relied on higher authorities. The Court upholds petitioners' argument, citing previous decisions like Madras Granites (P) Ltd. and Narasus Roller Flour Mills cases. The Court emphasizes the Assessing Officer's duty to independently assess proposals. In response, the Commissioner of State Tax issued Circular No.3 in 2019, allowing Assessing Officers to deviate from proposals without higher authority approval.

The judgment notes that petitioners paid 10% of tax demand per interim orders. Following Circular No.3, the impugned proceedings based on Enforcement Wing/ISIC proposals are set aside. Matters are remanded to Assessing Officer for reassessment. Assessees have 30 days to file objections with supporting documents. The Assessing Officer must provide a personal hearing, possibly through Video Conferencing, and conclude assessment within 12 weeks of receiving objections. If no objections are received within 30 days, assessment proceedings begin after the deadline.

In conclusion, the Writ Petitions are allowed based on the Circular empowering Assessing Officers' independence. The judgment provides detailed directions for reassessment proceedings, emphasizing fairness and adherence to legal principles. The Miscellaneous Petitions are closed without costs.