Natural justice and personal hearing requirements vitiated a final assessment, leading to remand for fresh consideration.

An assessment under the Tamil Nadu Value Added Tax Act, 2006 was unsustainable because the assessee was not given an effective personal hearing before finalisation. Section 27 required an opportunity of hearing before final assessment, and the notice procedure did not satisfy that safeguard. Although the transaction classification involved factual examination, the decisive defect was that the assessee sought time, filed a written reply with supporting material, and still received no hearing. The resulting breach of natural justice vitiated the assessment, which was set aside and remanded for fresh assessment after compliance with the hearing requirement.

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Issues: Whether the assessment order could be sustained when the assessee was not afforded a personal hearing before finalisation of assessment under the statutory scheme.

Analysis: The dispute related to an assessment under the Tamil Nadu Value Added Tax Act, 2006. The Court noted that although classification of the transaction as a works contract would ordinarily involve factual examination, the decisive defect in the present case was the absence of a personal hearing. Section 27 of the Act contemplates an effective opportunity before final assessment, and the notice procedure adopted did not secure such hearing. The assessee had sought time, later filed a written reply with supporting material, but no hearing was granted thereafter. The violation of natural justice rendered the assessment unsustainable.

Conclusion: The assessment order was set aside for breach of natural justice and non-compliance with the statutory requirement of hearing, and the matter was remanded for fresh assessment after giving the assessee an opportunity of hearing.

Final Conclusion: The assessment was invalidated and the dispute was sent back for reconsideration de novo after compliance with the hearing requirement.

Ratio Decidendi: An assessment that is finalised without affording the assessee an effective personal hearing, where the statute requires such opportunity, is vitiated by breach of natural justice and must be set aside for fresh consideration.

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