2020 (4) TMI 307 - HC - VAT and Sales Tax

Court quashes order under TNGST Act, remits to Assessing Officer for fair hearing.

M/s Indian Commercial Syndicate Versus The Special Committee, The Commercial Tax Officer (CT)

The Court quashed the impugned order passed under Section 16-D of the TNGST Act, 1959, due to the petitioner not being given a fair opportunity to be ... Ex-parte order passed by the Special Committee rejecting the application since the application was filed beyond the period of limitation of 3 years - Return of seized goods or in the alternative furnish xerox copies of the records seized - manufacture and sale of Poultry feed which was exempted in terms of Entry No.57 of Part B of the Third Schedule of TNGST Act, 1959 - Since, the petitioner claimed to be exempted dealer, the petitioner claims that the petitioner had not maintained proper records - HELD THAT:- Powers vested with the 1st respondent include the powers to set aside orders impugned before it or direct the Assessing Officer to make a fresh assessment and/or pass fresh order in such manner as may be directed. Thus, power has been given to the 1st respondent to examine the issue without any inhibition of limitations prescribed under the Act where an assessee was unable to participate in the proceeding or appropriate order from an Assessing Officer - Though the impugned order of the 1strespondent adverts to be proceedings which was challenged before it, it fails to address the core issue before it. Since the petitioner did not get to participate in the hearing and an ex parte order came to be passed by the 2nd respondent, the petitioner deserves an opportunity of being heard - 2nd respondent is therefore directed to pass appropriate orders on merits within a period of three months from date of receipt of a copy of this order. Petition disposed off. Issues:1. Validity of the order passed under Section 16-D of the TNGST Act, 1959.2. Applicability of limitation period for filing application under Section 16-D.3. Dispute regarding Assessment Years 1998-1999 and 1999-2000.4. Allegations of lack of cooperation by the petitioner in assessment proceedings.5. Seizure of records and subsequent legal actions.6. Impugned orders and contentions of the petitioner.7. Justification of impugned order by the respondents.8. Consideration of arguments by both parties.Analysis:1. The petitioner challenged the order passed under Section 16-D of the TNGST Act, 1959, where a Special Committee rejected the application citing lack of cooperation by the petitioner in assessment proceedings and the absence of valid grounds for the application. The Committee also considered the limitation period for filing the application, concluding that the petition was time-barred.2. The dispute revolved around the Assessment Years 1998-1999 and 1999-2000, with the petitioner claiming exemption as a dealer of Poultry feed. The petitioner alleged that proper records were not maintained, leading to assessment orders being finalized without a check of accounts, reserving the right for future re-assessment.3. Legal actions, including seizure of records and arrest of the petitioner's partner, affected the assessment process. Notices for assessments were issued but allegedly not served on the petitioner, leading to revised assessment orders. The petitioner filed an application under RTI to obtain assessment order copies, subsequently applying under Section 16-D in 2013, resulting in the impugned order of 2015.4. The respondents contended that the petitioner failed to cooperate in the assessment proceedings, missed deadlines, and did not exercise appellate remedies, justifying the impugned order. The Special Government Pleader argued against the petitioner's diligence and sought dismissal of the writ petition.5. The Court analyzed the arguments and found that the petitioner was not given a fair opportunity to be heard, especially in light of ex parte orders. Consequently, the Court quashed the impugned order and remitted the case back to the Assessing Officer to pass appropriate orders within a specified timeframe, emphasizing the petitioner's right to a hearing and cooperation in the proceedings.6. The Court directed the petitioner to appear before the Assessing Officer, ensuring a fair opportunity for a hearing and cooperation. Failure to cooperate may lead to orders based on available records. The writ petition was disposed of without costs, with connected petitions closed.