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Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether reassessment could be sustained when the assessee was not afforded a reasonable opportunity of hearing and the material relied upon for reopening was not disclosed, including denial of cross-examination of persons whose statements or information formed the basis of the reassessment.
Analysis: Section 28(1) of the M.P. Commercial Tax Act, 1994 requires the authority to give the dealer a reasonable opportunity of being heard before reassessment and to make such enquiry as necessary. Reassessment under that provision is quasi-judicial in nature and must conform to the principles of natural justice. Where the taxing authority relies on material collected behind the assessee's back and does not disclose that material or permit effective rebuttal, the assessee is denied a fair hearing. The governing principle is that, when evidentiary material is used against a dealer, the dealer must have a fair opportunity to challenge it, including by cross-examination where necessary.
Conclusion: The reassessment was unsustainable for breach of natural justice and absence of a reasonable opportunity of hearing. The issue is decided in favour of the assessee.
Ratio Decidendi: A reassessment made under a taxing statute that expressly requires a reasonable opportunity of hearing cannot stand if the authority relies on undisclosed material collected behind the assessee's back and denies an effective opportunity to rebut that material.
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