2019 (9) TMI 572 - HC - VAT and Sales Tax

Court sets aside assessment orders for violating natural justice principles, remits matter for reassessment

The court allowed the writ petitions challenging assessment orders for assessment years 2012-13 to 2016-17 due to violation of natural justice principles. ... Principles of natural justice - opportunity to file objections - notice of proposal - obligation to communicate acceptance or rejection of request for adjournment - remand for fresh assessmentPrinciples of natural justice - opportunity to file objections - notice of proposal - Assessment orders were passed without giving the assessee sufficient opportunity to file objections in response to notices of proposal. - HELD THAT: - The assessee sent letters dated 15.03.2019 requesting time up to 15.04.2019 to submit replies to the notices of proposal; those letters were received and acknowledged by the Assessing Officer. Despite receipt, the Assessing Officer proceeded to pass assessment orders on 29.03.2019, recording that the assessee failed to file objections. Where a request for time to file objections has been communicated to the authority and acknowledged, the authority must inform the party whether the request is accepted or refused before treating the matter as the party's non-response. Failing to communicate the outcome of the request and proceeding to confirm proposals without giving the assessee an opportunity to be heard amounts to a breach of the principles of natural justice.Finding of violation of principles of natural justice; the assessments as passed are unsustainable for lack of opportunity to file objections.Obligation to communicate acceptance or rejection of request for adjournment - remand for fresh assessment - Whether the matters should be remitted for fresh decision after affording the assessee an opportunity to file objections. - HELD THAT: - Given the admitted receipt of the assessee's request for time and the Assessing Officer's failure to communicate acceptance or rejection, the appropriate remedy is to set aside the impugned orders and remit the matters to the Assessing Officer. On remand, the Assessing Officer is to receive the assessee's reply from the date of receipt of this order and thereafter decide the assessments on merits and in accordance with law within the time directed by the Court.Impugned assessment orders set aside and matters remitted to the Assessing Officer for fresh assessment after receipt of the assessee's reply; Assessing Officer to decide within four weeks of receiving the reply.Final Conclusion: The writ petitions are allowed: the assessment orders for AYs 2012-13 to 2016-17 are set aside for breach of natural justice and the matters are remitted to the Assessing Officer to receive the assessee's replies and redo the assessments on merits and in accordance with law within four weeks of receipt of such replies. Issues:Challenging assessment orders for assessment years 2012-13 to 2016-17 based on violation of natural justice principles.Analysis:The petitioner contended that the assessment orders were passed without giving them sufficient opportunity to respond to the notices of proposals. The petitioner requested time to file objections through letters dated 15.03.2019, indicating the need for additional data and GSTR2A reconciliation. These letters were acknowledged by the Assessing Officer on 20.03.2019 but the assessment orders were passed on 29.03.2019, stating that no objections were filed despite sufficient time given. The court noted that the Assessing Officer proceeded without informing the petitioner about the acceptance or rejection of their request for time, which violated principles of natural justice.The court emphasized that the Assessing Officer should have communicated the decision on the petitioner's request for time to submit objections. The lack of communication created a presumption for the petitioner that their request was accepted. As the assessment orders were passed merely by confirming the proposals in the absence of objections, the court concluded that the matter should be sent back to the Assessing Officer for reassessment based on merits and in accordance with the law after obtaining objections from the petitioner.Accordingly, the writ petitions were allowed, the impugned orders were set aside, and the matter was remitted to the Assessing Officer for reassessment. The Assessing Officer was directed to redo the assessment after receiving the petitioner's reply within four weeks from the date of the court's order. The reassessment was to be done on merits and in compliance with the law. No costs were awarded, and the connected miscellaneous petitions were closed.