Independent application of mind in tax assessment is essential; mechanical adoption of an enforcement proposal can invalidate the order.

Assessment orders are vulnerable where the Assessing Officer merely adopts an Enforcement Wing proposal without independently considering the dealer's objections, supporting records, and returned materials. The text also notes that a specific plea against levy of penalty must be dealt with expressly; failure to address that contention renders the order legally infirm. The operative consequence described is quashing of the assessment orders and remand for fresh consideration after personal hearing, opportunity to produce records, and a reasoned decision on merits and in accordance with law.

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Issues: (i) whether the assessment orders were vitiated for want of independent application of mind by the Assessing Officer; (ii) whether the question of levy of penalty survived on the facts of the case.

Issue (i): whether the assessment orders were vitiated for want of independent application of mind by the Assessing Officer.

Analysis: The assessment was made after remand, but the impugned order showed that the Assessing Officer relied solely on the proposal of the Enforcement Wing officers. The materials and objections furnished by the dealer were not independently considered, and the order did not reflect an independent appraisal of the returns or records produced. Such a mechanical approach was held to be unsustainable in law.

Conclusion: The assessment orders were vitiated and liable to be set aside.

Issue (ii): whether the question of levy of penalty survived on the facts of the case.

Analysis: The objection that no penalty could be levied was specifically raised, as the assessments were based on books of account and the dealer had claimed stock transfer. The Assessing Officer ignored this fundamental contention while passing the orders. The omission to deal with the plea on penalty rendered the order legally infirm.

Conclusion: The issue of penalty could not be sustained against the petitioner on the impugned reasoning.

Final Conclusion: The writ petitions were allowed, the assessment orders were quashed, and the matter was remanded for fresh consideration after granting personal hearing and an opportunity to produce records, with a reasoned decision on merits and in accordance with law.

Ratio Decidendi: An assessment order is unsustainable when it is passed mechanically on the basis of the Enforcement Wing proposal without independent consideration of the dealer's objections and supporting records, especially where a specific plea affecting penalty is left unaddressed.

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