2020 (8) TMI 135 - HC - VAT and Sales Tax

Court Reinstates Tax Appeals Dismissal, Emphasizes Procedural Fairness

The court set aside the dismissal of appeals in default under the Kerala Value Added Tax Act for assessment years 2012-13, 2013-14 & 2014-15, citing ... Validity of assessment order - appeal dismissed in default - benefits of the limitation as per provisions of Section 25(1) of KVAT Act - HELD THAT:- Appeals preferred against the assessment orders Exts.P1 to P3 and appeals Exts.P4 to P6 were filed have been dismissed in default vide order dated 16.03.2020 Exts.P9 to P11 - Section 55(5) of the Kerala erstwhile Act, 2003 do not specifically envisage any said provisions for appellate authority to dismiss appeal in default but said provisions as contended by the Government Pleader empowers the appellate authority to pass such an order it may deem appropriate. Nothing prevented officer to follow principles of natural justice which are conspicuously absent from the impugned order as it reflects only of affording two opportunities - It is also matter of concern that during the period when the appeals were taken up and dismissed in default there was already a threat of Corona Virus/COVID- 19 pandemic though the lock down only began on 24.03.2020 with a lock down of one day on 22.03.2020. Matter is remitted and ordered to be revisited at the level of first appellate authority to hear the appeals afresh in accordance with law, after affording an opportunity of hearing - appeal allowed by way of remand. Issues:Dismissal of appeals in default under the Kerala Value Added Tax Act for assessment years 2012-13, 2013-14 & 2014-15.Analysis:The petitioner appealed against assessment orders Exts.P1 to P3, which were dismissed in default due to lack of representation. The petitioner's counsel argued that appeals cannot be dismissed at par as per Section 55(5) of the KVAT Act. The Government Pleader contended that the petitioner intentionally did not appear to take advantage of the limitation under Section 25(1) of the Act. The court noted that while the Act does not specifically allow for dismissal in default, the appellate authority has the discretion to do so. However, the court found the lack of natural justice in the impugned order, especially considering the circumstances during the COVID-19 pandemic.The court set aside the impugned orders Exts.P9 to P11 and ordered the appeals to be heard afresh at the first appellate authority after affording the petitioner an opportunity to be heard. The parties were directed to appear before the authority on a specified date. The court also acknowledged the interim stay during the pending appeals and ruled that once the appeals are restored, the interim orders automatically come into effect.In conclusion, the court disposed of the writ petition by ordering a fresh hearing of the appeals to ensure procedural fairness and compliance with the law.