Court refuses intervention in TDS compliance assessment orders, directs appeal process for petitioner

The court declined to intervene in the assessment orders concerning Tax Deducted at Source (TDS) compliance under Section 13 of the Tamil Nadu Value Added Tax Act. The petitioner's failure to respond to pre-assessment notices led to the issuance of assessment orders and bank account attachments. The court emphasized the availability of an appeal remedy under Section 51 of the TNVAT Act, advising the petitioner to pursue this route. The petitioner was permitted to submit additional documents to demonstrate compliance, and the original orders were returned for the appeal process. No costs were imposed, and all four writ petitions were disposed of accordingly.

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Issues Involved:
1. Core issue of Tax Deducted at Source (TDS) compliance under Section 13 of the Tamil Nadu Value Added Tax Act, 2006 (TNVAT Act).
2. Failure to respond to pre-assessment notices.
3. Availability and appropriateness of alternate remedy through appeal under Section 51 of TNVAT Act.

Issue-wise Detailed Analysis:

1. Core Issue of TDS Compliance Under Section 13 of TNVAT Act:
The primary issue in all four writ petitions revolves around the compliance with TDS provisions as stipulated under Section 13 of the TNVAT Act. The petitioner, engaged in civil contract work for Chennai Corporation, was alleged to have failed to produce adequate documents for the assessment years in question (2012-2013, 2013-2014, 2014-2015, and 2015-2016). Consequently, the Assessing Officer issued assessment orders based on the perceived non-compliance.

2. Failure to Respond to Pre-assessment Notices:
For W.P.No.3219 of 2019 (Assessment Year 2012-2013), the petitioner did not respond to a pre-assessment notice dated 09.01.2018, which called for objections and supporting documents. The assessment order was thus passed, leading to the attachment of the petitioner’s bank account. Similarly, for the other three writ petitions, the petitioner did not respond to pre-assessment notices, resulting in the issuance of assessment orders and subsequent bank account attachments.

3. Availability and Appropriateness of Alternate Remedy:
The court highlighted the availability of an effective and efficacious alternate remedy through an appeal to the jurisdictional Appellate Deputy Commissioner under Section 51 of TNVAT Act. The court emphasized that the rule of alternate remedy is a rule of discretion, particularly stringent in fiscal matters involving taxes, as elucidated in the Supreme Court judgments in Satyawati Tondon and K.C. Mathew cases. The court noted that the petitioner did not utilize this remedy and did not respond to pre-assessment notices, which could have addressed the compliance issues.

Conclusion and Orders:
The court decided not to interfere with the impugned assessment orders, advising the petitioner to pursue the alternate remedy of appeal under Section 51 of TNVAT Act. The court allowed the petitioner to file additional documents before the appellate authority to demonstrate compliance with the obligations under the TNVAT Rules. The court also directed the return of original impugned orders to the petitioner’s counsel to facilitate the appeal process. All four writ petitions were disposed of with these observations, and no costs were imposed.

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