Mandatory personal hearing before assessment was required; absence of effective hearing led to quashing and fresh assessment.

An assessment under the Kerala Value Added Tax Act was held unsustainable where the record did not show an effective personal hearing after objections to the proposal notice were filed. The authority was required to issue notice, consider the objections and grant a meaningful hearing before finalising the assessment; discarding the objections without such hearing amounted to non-compliance with the mandatory procedure and breach of natural justice. The assessment order was therefore quashed, and fresh assessment was directed after affording the assessee personal hearing and an opportunity to produce documents.

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Issues: Whether the assessment order was liable to be quashed for want of an effective opportunity of personal hearing under Section 25(1) of the Kerala Value Added Tax Act, 2003 and for breach of natural justice.

Analysis: The objections filed against the proposal notice were stated to have been considered, but the record did not show that any effective personal hearing was afforded after the objections were submitted. The authority was required to issue notice and grant a meaningful hearing before finalising the assessment. On the materials shown in the impugned order, no such procedure had been followed and the objections were discarded without proper hearing. This amounted to non-compliance with the mandatory procedure under the provision and a violation of the principles of natural justice.

Conclusion: The assessment order was unsustainable and was quashed. Fresh assessment was directed after affording the assessee an opportunity of personal hearing and permitting production of documents.

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