Petition allowed due to lack of reasons for assessment order, remitted for reconsideration with directions

The writ petition was allowed, setting aside the assessment order under the Tamil Nadu Value Added Tax Act for the financial year 2013-14 due to the lack of reasons provided for rejecting the petitioner's submissions and denying a personal hearing. The case was remitted back to the respondent for reconsideration, with directions to grant the petitioner a personal hearing, review all documents, including proof of service tax payment, and issue a reasoned order promptly, emphasizing the importance of providing reasons for decisions in the judicial system. No costs were imposed on either party.

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Issues:
Assessment order under Tamil Nadu Value Added Tax Act, 2006 for financial year 2013-14; Discrepancy in reporting other income by the petitioner; Failure to provide reasons for rejecting petitioner's submissions; Denial of opportunity for personal hearing to the petitioner.

Analysis:
The judgment pertains to a writ petition involving a registered dealer in glassware and glass decoration items under the Tamil Nadu Value Added Tax Act, 2006 for the financial year 2013-14. The petitioner received a notice from the respondent regarding the reporting of other income for a specific amount, which was deemed taxable at 14.5%. The petitioner responded by explaining their primary role as an indenting agency representing national and foreign companies, receiving commission for services rendered, and paying service tax accordingly. They clarified that the commission receipts reported as other income were subject to TDS under the Income Tax Act and service tax was duly remitted to the authorities.

The judgment emphasizes the necessity of providing reasons for decisions, citing the Hon'ble Supreme Court's stance on the right to reason as fundamental in a judicial system. It notes that the respondent's order lacked justification for disregarding the petitioner's submissions and for not granting a personal hearing, especially considering the petitioner's role as indenting agents representing various companies. The absence of reasons and denial of a personal hearing were deemed sufficient grounds to interfere with the impugned order.

Consequently, the writ petition was allowed, the impugned order was set aside, and the matter was remitted back to the respondent for fresh consideration. The respondent was directed to provide the petitioner with an opportunity for a personal hearing or representation, evaluate all submitted documents, including proof of service tax payment, and issue a reasoned order in line with the law promptly. The judgment concluded by closing the matter without imposing any costs on either party.

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