Statutory audit authority must be exercised by the designated officer; assessments based on unauthorised audit were set aside.

Section 64(4) of the Tamil Nadu Value Added Tax Act, 2006 vests the power to order audit of registered dealers in the Commissioner, and that authority cannot be exercised by a subordinate officer. Audit ordered without such jurisdiction is invalid, and any assessment founded on that audit is vitiated. The Madras High Court therefore set aside the assessment orders based on the unauthorised audit and remitted the matter for fresh consideration, with a further opportunity for the dealer to file accounts and objections before reassessment.

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Issues: Whether audit under Section 64(4) of the Tamil Nadu Value Added Tax Act, 2006 could be ordered by an officer subordinate to the Commissioner, and whether the assessment orders founded on such audit were liable to be set aside and remitted.

Analysis: Section 64(4) vests the power to order audit of registered dealers in the Commissioner and requires the audit to be conducted by an officer not below the rank prescribed by the statute. That power cannot be exercised by a subordinate authority or be treated as having been validly assumed by one. Since the impugned assessments were based on an audit ordered by an officer lacking such authority, the assessments were vitiated. The matter also required a fresh opportunity to the petitioner to file accounts and objections before any reassessment.

Conclusion: The audit order was without jurisdiction and the assessment orders based on it could not stand. The petitioner succeeded, and the matters were remitted for fresh consideration after due opportunity.

Ratio Decidendi: A power to order statutory audit, when expressly conferred on a designated authority, must be exercised only by that authority or in the manner authorized by law; an assessment founded on an audit ordered without jurisdiction is liable to be set aside.

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