2016 (8) TMI 1411 - HC - VAT and Sales Tax

Court Orders Petitioner to Pay 25% of Tax, Allows Objections

The court directed the petitioner to pay 25% of the disputed tax within three weeks, allowing them to submit objections and receive a personal hearing for ... Pre-assessment notice - opportunity of personal hearing - treating assessment order as show cause notice - re-do the assessment after considering objections - conditional interim reliefPre-assessment notice - treating assessment order as show cause notice - re-do the assessment after considering objections - opportunity of personal hearing - Whether the writ petition should be allowed by granting conditional relief directing the respondent to permit the petitioner to submit objections and for re-doing the assessment after affording personal hearing - HELD THAT: - The Court noted a disputed factual claim by the petitioner that the pre-assessment notice was received by a consultant and not by an authorised accountant of the petitioner (recorded in the file). Observing that such a factual dispute could have been gone into by the Appellate Authority, the Court nevertheless granted a conditional remedy. The petitioner was directed to pay 25% of the disputed tax within three weeks; upon compliance the petitioner may treat the impugned assessment order as a show cause notice and submit objections within two weeks. Thereafter the respondent is directed to consider the objections and re-do the assessment in accordance with law after affording an opportunity of personal hearing to the petitioner. The Court made clear that failure to comply with the payment condition within the stipulated time would cause the writ petition to stand automatically dismissed without further reference to the Court, leaving statutory remedies open to the petitioner. [Paras 5, 6, 8]Petition disposed by granting conditional relief: on payment of 25% of disputed tax within three weeks the petitioner may submit objections treating the assessment as a show cause notice, and the respondent shall re-do the assessment after personal hearing; non-compliance results in automatic dismissal of the writ petition.Final Conclusion: Writ petition disposed on terms: conditional relief granted subject to payment of 25% of the disputed tax and compliance with directions for submission of objections and re-assessment after personal hearing; non-compliance leads to dismissal. Issues:Challenge to assessment order under the Central Sales Tax Act, 1959 for the year 2014-15 based on lack of opportunity due to non-service of pre-assessment notice.Analysis:The petitioner filed a writ petition challenging the assessment order under the CST Act for the year 2014-15, contending that the order was passed without providing an opportunity since the pre-assessment notice was not served on the petitioner. The court directed the Additional Government Pleader (Taxes) to verify this claim. It was revealed that the pre-assessment notice was received by an individual who was not the petitioner's Accountant but was engaged as a Consultant at that time. The court noted that this discrepancy was a disputed question of fact that should have been addressed before the Appellate Authority.In response to the situation, the petitioner, through their counsel, expressed readiness to pay 25% of the disputed tax and requested to submit objections to contest the assessment on merits. After hearing both parties, the court directed the petitioner to pay 25% of the disputed tax within three weeks. Upon compliance, the petitioner could treat the assessment order as a show cause notice, submit objections within two weeks, and the respondent would reconsider the assessment after providing a personal hearing to the petitioner. Failure to comply would result in the dismissal of the writ petition without further reference to the court.Consequently, the court disposed of the writ petition with the specified conditions. No costs were awarded, and the connected miscellaneous petition was closed.