Speaking orders and personal hearing are required in tax rectification matters when a dealer specifically seeks fair consideration.

Rectification under Section 84 of the Tamil Nadu Value Added Tax Act, 2006 must be disposed of through a speaking order and consistent fair procedure, especially where the dealer specifically requests a personal hearing. The Madras High Court noted that the rejection of rectification applications, arising from assessments proposing reversal of input tax credit, was non-speaking and did not reflect issue-wise consideration of objections. Relying on the departmental circular requiring reasonable opportunity, consideration of objections, and personal hearing in assessment proceedings, the Court held the rejection unsustainable. The impugned assessments and connected orders were set aside and the matter remanded for fresh consideration de novo after granting personal hearing.

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Issues: Whether the rejection of the rectification application under Section 84 of the Tamil Nadu Value Added Tax Act, 2006 without affording personal hearing and without a speaking order was valid, and whether the assessment orders required to be set aside and reconsidered.

Analysis: The rectification requests arose from assessment orders passed after pre-assessment notices proposing reversal of input tax credit. The impugned intimation rejected the applications on the footing that the claim did not disclose any apparent error. The order was found to be non-speaking and inconsistent with fair procedure, particularly because the dealer had specifically sought personal hearing. Though Section 84 does not expressly mandate personal hearing in every case, fair disposal of rectification requires the assessee to be heard where such hearing is asked for. The Court also relied on the Commissioner's Circular No. 7/2014 dated 03.02.2014, which required reasonable opportunity, consideration of objections issue-wise, speaking orders, and personal hearing in assessment proceedings.

Conclusion: The rejection of the rectification applications was not sustainable. The impugned assessments and orders were set aside and the matter was remanded for fresh consideration de novo after granting personal hearing.

Ratio Decidendi: A rectification or assessment order affecting tax liability must be supported by a speaking order and, where personal hearing is specifically sought, fair procedure requires that such hearing be afforded before final rejection or confirmation.

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