Premature recovery and denial of personal hearing vitiated assessment proceedings and led to quashing and remand.

Coercive attachment and recovery based on an assessment are premature if initiated before expiry of the statutory appeal period, because the assessee must first have the full benefit of the time allowed to challenge the order; the attachment and garnishee notices were therefore quashed. An assessment made without the mandated reasonable opportunity of being heard, including personal hearing where required by the proviso, violates natural justice; the assessment orders were accordingly set aside and remitted for fresh consideration after hearing the assessee.

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Issues: (i) Whether attachment and recovery proceedings initiated during the period available for filing appeal against the assessment orders were premature; (ii) Whether the assessment orders were liable to be set aside for want of personal hearing and breach of natural justice.

Issue (i): Whether attachment and recovery proceedings initiated during the period available for filing appeal against the assessment orders were premature.

Analysis: The assessments had been served only shortly before the attachment notices were issued, while the statutory appeal period had not expired. Recovery could not be undertaken before the assessee had the full benefit of the appeal period. The coercive attachment was therefore unsustainable as it preceded the expiry of the time available to challenge the assessment.

Conclusion: The attachment and garnishee notices were premature and were quashed, in favour of the assessee.

Issue (ii): Whether the assessment orders were liable to be set aside for want of personal hearing and breach of natural justice.

Analysis: The proviso to the assessment provision required that the dealer be given a reasonable opportunity of being heard before assessment. That requirement included personal hearing. Since no personal hearing had been afforded before the orders were passed, the assessments suffered from violation of natural justice.

Conclusion: The assessment orders were set aside and the matter was directed to be heard afresh, in favour of the assessee.

Final Conclusion: The coercive recovery was interdicted and the assessments were annulled for fresh consideration after hearing the assessee.

Ratio Decidendi: Recovery based on an assessment should not be enforced before expiry of the statutory appeal period, and an assessment made without the mandated reasonable opportunity of hearing, including personal hearing where required, is liable to be set aside.

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