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2020 (11) TMI 923 - HC - VAT and Sales TaxPrinciples of Natural Justice - Reversal of Input Tax Credit - deemed assessment was made in respect of the Petitioner for the year 2010-2011 - TNVAT Act - HELD THAT - The receipt of the replies dated 07.09.2013 and 17.09.2013 sent by the Petitioner in response to the notice dated 30.08.2013 issued by the Respondent has not been rebutted. As such, the submissions made by the Petitioner deserve acceptance and the impugned order entailing adverse civil consequences to the Petitioner in violation of the principles of natural justice and the statutory requirements cannot be sustained, and it is quashed and the matter has to be decided afresh by the Respondent. It is incumbent upon the Respondent, after affording full opportunity of personal hearing to the Petitioner, to deal with each of the contentions raised by the Petitioner and pass reasoned orders on merits and in accordance with law following the prescribed procedure in consonance with the principles of natural justice and communicate the decision taken to the Petitioner under written acknowledgment. Petition allowed by way of remand.
Issues:
Deemed assessment under TNVAT Act for the year 2010-2011, VAT audit by Enforcement Wing, Reversal of Input Tax Credit (ITC) claim, Failure to consider objections by Petitioner, Violation of principles of natural justice, Quashing of impugned order, Fresh decision by Respondent after personal hearing, Compliance with statutory requirements and principles of natural justice. Analysis: The judgment pertains to a case involving a deemed assessment made under the Tamil Nadu Value Added Tax Act, 2006 for the year 2010-2011. Subsequently, the Enforcement Wing conducted a VAT audit of the Petitioner's accounts, leading to a Notice dated 30.08.2013 requiring the Petitioner to submit objections for the proposed reversal of the Input Tax Credit (ITC) claim. The Petitioner contends that it had submitted replies dated 07.09.2013 and 17.09.2013 via speed post, with proof of postal registration. However, the Respondent proceeded to reverse the ITC claim on the erroneous premise that no objections were filed by the Petitioner, leading to the filing of a Writ Petition challenging this decision primarily on the grounds of non-consideration of the Petitioner's replies. The court noted that the receipt of the Petitioner's replies had not been rebutted, indicating that the submissions made by the Petitioner should be accepted. The impugned order, which had adverse civil consequences for the Petitioner and violated principles of natural justice and statutory requirements, was deemed unsustainable and quashed. The matter was directed to be decided afresh by the Respondent, emphasizing the importance of following due process and considering all relevant submissions. To expedite the proceedings, both parties agreed to conduct an enquiry before the Respondent to provide the Petitioner with a personal hearing. The court emphasized that the Respondent must carefully consider each contention raised by the Petitioner, pass reasoned orders in accordance with the law, and communicate the decision to the Petitioner in writing. This directive aimed to ensure compliance with statutory requirements and principles of natural justice, emphasizing the importance of a fair and transparent decision-making process. Ultimately, the Writ Petition was allowed on the terms mentioned above, with the connected Miscellaneous Petitions being closed without any costs imposed. The judgment underscores the significance of upholding procedural fairness, respecting the rights of parties to be heard, and ensuring that decisions are made in accordance with the law and established principles of justice.
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