Mandatory notice and personal hearing are required before enhancing tax demand; breach of natural justice led to remand.

An assessment order enhancing tax demand and reversing input tax credit could not be sustained where the record did not show issue of notice or compliance with the statutory requirement of personal hearing under Section 84 of the Tamil Nadu Value Added Tax Act, 2006. The court held that enhancement without notice and hearing breaches both the statutory mandate and the principles of natural justice, particularly where no speaking order shows such compliance. The assessment was set aside and the matter remitted for fresh disposal after granting an opportunity of personal hearing.

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Issues: Whether an assessment order enhancing the tax demand and reversing input tax credit could be sustained when no notice or opportunity of personal hearing was given.

Analysis: The impugned order did not disclose that any notice had been issued to the dealer. The record also did not show compliance with the statutory requirement of hearing under Section 84 of the Tamil Nadu Value Added Tax Act, 2006. An order that enhances the demand without affording notice and personal hearing is contrary to the mandate of the provision and offends the principles of natural justice. In the absence of a speaking order showing compliance, the assessment could not be sustained.

Conclusion: The assessment order was set aside and the matter was remitted to the respondent for fresh disposal after giving the petitioner an opportunity of personal hearing.

Ratio Decidendi: Where enhancement of tax demand is made, statutory notice and personal hearing are mandatory, and an order passed in breach of that requirement and the principles of natural justice is liable to be set aside and remanded.

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