Tax assessment must consider filed objections; an order based on a wrong factual premise was set aside and remitted.

A quasi-judicial tax assessment must be made on the basis of the record and after considering the assessee's objections to the proposal notice. Where the objections were in fact filed and acknowledged in the department's file, but the assessment order proceeded on the incorrect premise that no objections had been submitted and did not deal with them, the order could not withstand judicial scrutiny. The Madras High Court set aside the assessment and remitted the matter to the assessing authority for fresh consideration of the objections and a fresh order in accordance with law.

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Issues: Whether the assessment order was vitiated for failure to consider the assessee's objections to the proposal notice, and whether the matter required remand for fresh consideration.

Analysis: The objections filed by the assessee were found in the assessment file with the department's acknowledgment. The assessment order, however, proceeded on the incorrect basis that no objections had been filed and did not deal with the objections at all. An assessment under the taxing statute is a quasi-judicial exercise and must be made in accordance with law after considering the material placed before the assessing authority. A final order that ignores the objections and records a contrary factual position cannot stand judicial scrutiny.

Conclusion: The assessment order was set aside and the matter was remitted to the assessing authority to consider the objections and pass a fresh order in accordance with law.

Ratio Decidendi: A quasi-judicial tax assessment that is made on a demonstrably incorrect factual premise and without considering the assessee's filed objections is unsustainable and must be set aside for fresh consideration.

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