Natural justice in reassessment: assessment set aside and remitted because the taxpayer was denied a fair hearing.

An assessment reopened under the Tamil Nadu Value Added Tax Act was held unsustainable because the taxpayer was not given a reasonable opportunity of being heard despite requesting one. The court noted that the original assessment had been completed on the returns, and the later adverse reassessment was based on an enforcement report, but the record did not show sufficient compliance with natural justice before the order was passed. The assessment order was set aside, and the matter was remitted to the assessing authority for fresh consideration after allowing objections, documentary evidence, and a hearing.

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Issues: Whether the assessment order was liable to be set aside for violation of principles of natural justice and the matter remitted for fresh consideration.

Analysis: The assessment was originally completed accepting the returns under Section 22(2) of the Tamil Nadu Value Added Tax Act, 2006, and was later reopened under Section 27 of the same Act on the basis of the enforcement report. The impugned order was challenged on the ground that the petitioner was not afforded a reasonable opportunity of being heard, despite a specific request for such opportunity. As the assessment had serious civil consequences and the record showed absence of sufficient hearing before the adverse order was passed, the order was found unsustainable on the ground of breach of natural justice.

Conclusion: The assessment order was set aside and the matter was remitted to the assessing authority for fresh consideration after giving the petitioner an opportunity to file objections and documentary evidence and to be heard.

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