Natural justice and factual inquiry govern tax waiver rejection, requiring fresh consideration of relevant records and hearing.

An order rejecting waiver of tax under the Tamil Nadu General Sales Tax Act was vulnerable where the authority did not examine the relevant records on collection, accounting entries, and the applicability of the governing Government Orders. The rejection was also unsustainable because the assessee was not effectively heard on the material aspects, amounting to breach of natural justice. The matter was therefore remitted for fresh consideration on merits, with liberty to file additional representation and with directions to evaluate the factual basis for waiver entitlement before deciding afresh.

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Issues: Whether the rejection of the request for waiver of tax under the Tamil Nadu General Sales Tax Act, 1959 could be sustained without examining the relevant material and affording a proper hearing, and whether the matter required remand for fresh consideration.

Analysis: The request for waiver had to be considered on the basis of the relevant records, including the manner in which collections were reflected in the returns and accounts, and the applicability of the relevant Government Orders. The impugned rejection was founded on a presumed failure to satisfy the conditions of the Government Orders and on the balance-sheet provision for tax liability, without a proper factual inquiry into whether tax had in fact been collected. Since the factual exercise necessary to decide entitlement to waiver was not undertaken and the petitioner was not effectively heard on the material aspects, the order suffered from violation of the principles of natural justice.

Conclusion: The rejection of waiver was not sustained and the matter was remitted for fresh consideration after giving the petitioner an opportunity to file additional representation and after examining the relevant materials.

Ratio Decidendi: An order rejecting tax waiver is liable to be set aside where it is passed without a proper factual inquiry into the relevant collection and accounting materials and without affording a fair opportunity of hearing, and the matter must be reconsidered afresh on merits.

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