Natural justice in tax reassessment defeated where reopening notices failed to disclose reasons and cited the wrong Act.

Reopening of deemed sales tax assessments was held invalid where the notices referred only to the Bengal Finance (Sales Tax) Act, 1941, but the final orders were made under the West Bengal Sales Tax Act, 1954. The dealer's replies were therefore confined to the wrong statutory basis, and no reasons for reopening were communicated, so the show-cause opportunity was not effective. Non-compliance with Rule 22AA of the West Bengal Sales Tax Rules, 1954, together with breach of natural justice, vitiated the reopening. The orders were set aside in favour of the assessee.

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Issues: Whether the reopening of the deemed assessments was vitiated because the notices were issued under the Bengal Finance (Sales Tax) Act, 1941, while the final orders were made under the West Bengal Sales Tax Act, 1954, and because the notices did not disclose the reasons for reopening.

Analysis: The notices called upon the dealer to meet a proposed reopening only with reference to the 1941 Act and never indicated that action would be taken under the 1954 Act. The dealer's replies were therefore confined to the 1941 Act and did not meet the case ultimately made in the orders. The record also showed that no reason for reopening was ever communicated to the dealer, so the opportunity to show cause was not an effective one. Compliance with Rule 22AA of the West Bengal Sales Tax Rules, 1954 required a proper notice and consideration of the cause shown; that requirement was not satisfied. Mere appearance on two dates and requests for adjournment did not cure the defect or amount to a valid opportunity to meet the case.

Conclusion: The reopening orders were invalid for breach of natural justice and non-compliance with Rule 22AA of the West Bengal Sales Tax Rules, 1954, and were rightly set aside in favour of the assessee.

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