High Court overturns tax assessment orders for lack of personal hearing and independent review by tax authority

The High Court set aside the revised assessment orders for various assessment years challenged by a dealer in jewels and ornaments due to lack of personal hearing and independent application of mind by the tax authority. The Court emphasized the necessity of providing a personal hearing even if objections were filed and requiring the assessing officer to independently consider objections before passing orders. The matter was remanded back to the tax authority with directions to conduct a personal hearing, provide reasoned orders, and comply with the law within six weeks. Non-cooperation from the petitioner could result in appropriate action by the tax authority.

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Issues:
Challenging revised assessment orders for multiple assessment years without opportunity of personal hearing and independent application of mind.

Analysis:
The petitioner, a dealer in jewels and ornaments, challenged revised assessment orders for various assessment years due to discrepancies pointed out by the respondent after inspections and scrutiny of returns. The petitioner submitted objections, but the respondent passed the impugned orders without providing a personal hearing or independent consideration. The High Court noted that the circular by the Commissioner of Commercial Taxes mandates a personal hearing, even if not requested, which was not followed by the respondent in this case.

A Division Bench decision highlighted that the opportunity of personal hearing cannot be denied, even if objections were not filed. In this case, although the petitioner submitted objections, the respondent failed to provide a personal hearing before passing the impugned orders. Therefore, the Court held that the orders must be set aside on this ground alone.

Furthermore, the Court observed that the respondent did not apply an independent mind to the objections and merely confirmed the proposal without giving reasons for rejection. Citing a previous judgment, the Court emphasized the necessity for the assessing officer to consider information independently and provide reasoned orders. As the respondent failed to do so in this case, the impugned orders were deemed unsustainable and set aside.

Consequently, the High Court set aside the impugned orders and remanded the matter back to the respondent for fresh consideration. The respondent was directed to conduct a personal hearing, pass reasoned orders, and comply with the law within six weeks. The Court clarified that non-cooperation from the petitioner could lead to appropriate action by the respondent. The writ petitions were disposed of with no costs, and connected miscellaneous petitions were closed accordingly.

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