Reasonable hearing in tax assessment was mandatory, and the assessment was set aside for fresh consideration.

Assessment proceedings imposing tax and penalty were held unsustainable where the assessee had not been given a reasonable opportunity of hearing before completion. The court noted that an assessment concluded after audit under the Tamil Nadu Value Added Tax Act, 2006 must comply with fair hearing requirements, and the absence of adequate opportunity to explain the case rendered the proceedings vulnerable. The matter was therefore set aside and remanded for fresh consideration after granting the assessee a proper hearing.

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Issues: Whether the assessment proceedings imposing tax and penalty were liable to be set aside for want of a reasonable opportunity of hearing before completion of the assessment.

Analysis: The assessment was made after an audit under Section 64(4) of the Tamil Nadu Value Added Tax Act, 2006 and culminated in a tax and penalty demand. The challenge was that the assessee was not afforded sufficient opportunity to explain its case before the assessment was concluded. In the circumstances, the absence of a fair hearing rendered the proceedings vulnerable, and the proper course was to remit the matter for a fresh decision after hearing the assessee.

Conclusion: The assessment proceedings were set aside and the matter was remanded to the respondent for fresh consideration after granting a reasonable opportunity of hearing to the assessee.

Ratio Decidendi: An assessment imposing tax and penalty cannot be sustained when concluded without affording the assessee a reasonable opportunity of hearing; such an is liable to be set aside and remanded for reconsideration.

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