Fair opportunity in reassessment was required; non-compliance with remand directions led to setting aside the assessment.

The Madras HC held that a reassessment could not stand where remand directions requiring supply of relied-upon materials, a meaningful opportunity to object, and cross-examination were not followed. In a dispute over alleged interstate purchases and eligibility for compounded tax under the Tamil Nadu VAT Act, the assessing authority proceeded on extracted objections and shifted the burden to the dealer without furnishing the underlying third-party material or addressing the request to verify the alleged transactions. The reassessment order was therefore set aside, and the matter was remitted for fresh assessment after supplying the full information, receiving objections, and allowing cross-examination if necessary.

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Issues: Whether the reassessment order could be sustained when the earlier remand directions to furnish the relied upon materials, afford an opportunity of hearing, and permit cross-examination were not complied with.

Analysis: The assessment concerned alleged interstate purchases and the assessee's entitlement to pay tax at the compounded rate under Section 3(4) of the Tamil Nadu Value Added Tax Act, 2006. The earlier writ order had required the assessing authority to supply all relevant materials and consider the assessee's objections before passing a fresh order. In the fresh proceedings, the authority relied on extracted portions of the objection and completed the assessment by placing the burden on the dealer under Section 17, without meaningfully addressing the request for the underlying third-party material, verification of the alleged Puducherry transactions, or cross-examination of the other dealer, if any. The order therefore did not give effect to the remand directions or satisfy the requirement of fair opportunity.

Conclusion: The reassessment order was held unsustainable and was set aside, with a direction to obtain the full information, furnish it to the assessee, receive objections, and thereafter complete the assessment in accordance with law after affording cross-examination if necessary.

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