2010 (1) TMI 1135 - HC - VAT and Sales Tax

High Court directs assessing officer to complete assessment with petitioner cooperation, lifts attachment order, requires affidavit not to alienate property.

The High Court directed the assessing officer to complete the assessment process after giving the petitioner an opportunity to cooperate and provide ... Whether once the appellate authority has set aside the order of assessment, the attachment order already passed based on the earlier order of assessment should automatically go? Held that:- Taking into consideration that the proceedings of assessment are pending before the assessing officer, we are of considered view that a direction has to be given to the assessing officer to pass order of assessment after giving due opportunity to the petitioner. In such a view of the matter, directing the second respondent to complete the process of assessment after giving sufficient opportunity to the petitioner as per the notice of the second respondent, the second respondent is given 30 days time from January 8, 2010 and pass appropriate orders. It is made clear that immediately on passing the assessment order, as per the order of remand made by the appellate authority dated December 2, 2008, the second respondent shall lift the order of attachment subject to the condition that the petitioner shall file an affidavit of undertaking before the assessing officer that the petitioner shall not alienate the property in question Issues:1. Validity of the order of assessment and levy of penalty.2. Compliance with directions of the appellate authority.3. Continuation of attachment order.4. Necessity of lifting the attachment order.5. Cooperation of the petitioner with the assessing officer.Analysis:1. The writ petition challenges the order of assessment dated December 31, 2003, directing the petitioner to pay tax and penalty. The appellate authority set aside this order on December 2, 2008, directing the assessing officer to pass fresh orders after checking the petitioner's accounts and providing an opportunity to file objections. The petitioner was required to produce accounts and cooperate within three months. The assessing officer provided records on January 8, 2010, for the petitioner to respond. The High Court directed the assessing officer to complete the assessment process after giving due opportunity to the petitioner.2. The petitioner failed to produce documents despite directions from the appellate authority. The assessing officer granted time for perusal of records and reply submission. The court emphasized the need for cooperation in completing the assessment process and lifted the attachment order upon passing the assessment order, subject to an affidavit of undertaking from the petitioner.3. The petitioner argued that the attachment order should automatically cease upon setting aside the assessment order. The respondents contended that the petitioner, no longer a dealer, might alienate the property, the only security for recovery. The court balanced these interests, emphasizing completion of assessment and cooperation while ensuring protection against property alienation.4. The court rejected the petitioner's argument for automatic lifting of the attachment order, considering the pending assessment proceedings and the need for security against potential alienation. The order to lift the attachment was made conditional upon the petitioner filing an affidavit undertaking not to alienate the property until appeal rights were exhausted.5. The court emphasized the importance of cooperation between the petitioner and the assessing officer in completing the assessment process. The petitioner was directed to file an affidavit undertaking not to alienate the property until appeal rights were exhausted. The court disposed of the writ petition with these directions, emphasizing cooperation and adherence to the assessment process.