Turnover estimation based on one day's sales and denial of hearing can render a restaurant assessment unsustainable.

Turnover estimation for a restaurant dealer under the Tamil Nadu Value Added Tax Act was discussed as unreliable when based only on one day's sales, because daily restaurant sales can vary materially and a single inspection day does not provide a safe basis for annual turnover assessment. The text also notes that where detailed objections are filed and personal hearing is sought, an assessment order must address those objections and afford an effective hearing; failure to do so amounts to breach of natural justice. On that basis, the impugned assessment was set aside and the matter remanded for fresh consideration after hearing the assessee.

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Issues: (i) whether the assessment could be sustained when the turnover was estimated on the basis of one day sales; (ii) whether the assessment order was liable to be interfered with for non-consideration of objections and denial of personal hearing.

Issue (i): whether the assessment could be sustained when the turnover was estimated on the basis of one day sales.

Analysis: The petitioner was a restaurant dealer assessed under the Tamil Nadu Value Added Tax Act, 2006. The challenge was that the respondent had relied on the inspection day sales to estimate the total taxable turnover and deny the compounded rate under Section 8(1)(a). The Court accepted that restaurant sales vary materially from day to day and that a single day's sales cannot, by itself, form a safe basis for estimating annual turnover. The earlier authorities cited by the petitioner were also noticed as supporting this approach.

Conclusion: The assessment based on one day sales was unsustainable.

Issue (ii): whether the assessment order was liable to be interfered with for non-consideration of objections and denial of personal hearing.

Analysis: The petitioner had filed a detailed reply and specifically requested a personal hearing. The impugned order did not properly deal with the objections, including the challenge to the turnover estimate, and no effective personal hearing was afforded. Since a personal hearing is required in assessment proceedings under the statutory regime, the order suffered from violation of natural justice and was liable to be set aside.

Conclusion: The assessment order was quashed and the matter was remanded for fresh consideration after granting opportunity of hearing and personal hearing.

Final Conclusion: The impugned assessment was annulled for failure to consider the objections and for breach of natural justice, and the matter was sent back for de novo adjudication.

Ratio Decidendi: An assessment cannot be sustained where turnover is estimated from a single day's sales without proper consideration of objections and without granting the assessee a personal hearing required by law.

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