Natural justice in tax assessment: ex parte order quashed where effective hearing was denied before completion.

An assessment order was set aside where the taxpayer was not given an effective opportunity of hearing before an ex parte assessment, and the review was rejected without hearing. The notice for hearing had been posted after the fixed date and was received only later, leaving the taxpayer unable to participate in the proceedings. The Court treated the denial of a fair hearing as the decisive defect, notwithstanding the allegation that the assessment was completed to avoid the limitation under Section 29 of the Goa VAT Act, 2005. The assessment was quashed and the matter restored for fresh consideration after granting an opportunity of hearing.

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Issues: Whether the assessment order was liable to be quashed for breach of the principles of natural justice on the ground that the petitioner was not given an effective opportunity of hearing before the ex parte assessment and the review was rejected without hearing.

Analysis: The notice for hearing was found to have been posted after the date fixed for appearance and was received only after that date, with the State accepting the factual assertions made by the petitioner. In those circumstances, the petitioner had been prevented from participating in the assessment proceedings, and the impugned order was passed without affording a fair hearing. The assessment was also stated to have been made to avoid the limitation under Section 29 of the Goa VAT Act, 2005, but the decisive defect was the denial of hearing. The Court therefore set aside the assessment and restored the proceedings so that the petitioner could be heard.

Conclusion: The assessment order was quashed and the matter was restored for fresh consideration after giving the petitioner an opportunity of hearing.

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