Independent application of mind required in VAT reassessment; mechanical adoption of Enforcement Wing proposal was set aside.

Revisional assessments under the Tamil Nadu Value Added Tax Act, 2006 were vulnerable where the assessing authority merely reproduced the Enforcement Wing proposal without independently examining the material. Applying the Narasus principle, the Court held that the authority must apply its own mind and cannot act as a conduit for the proposal; the penalty-based conclusions were therefore set aside. The request for personal hearing and production of documents was not treated as decisive, because such hearing was not held to be statutorily mandatory for proceedings under Section 27. The matter was remitted for fresh assessment in accordance with the prescribed circular and independent consideration of the record.

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Issues: Whether the revisional assessment orders passed under the Tamil Nadu Value Added Tax Act, 2006 were liable to be set aside for mechanical acceptance of the Enforcement Wing proposal without independent application of mind.

Analysis: The impugned orders arose after deemed assessment and purported revision under the Tamil Nadu Value Added Tax Act, 2006. The impugned assessments substantially reproduced the Enforcement Wing proposal and concluded that the declared turnover was incorrect, while also levying penalty. The Court accepted the challenge based on the Narasus principle, which requires the assessing authority to independently examine the material before it and not act as a mere conduit for the Enforcement Wing's proposal. The request for personal hearing and production of documents was not treated as determinative, since such hearing was held not to be statutorily imperative for proceedings under Section 27.

Conclusion: The assessment orders were set aside and the matter was remitted for fresh assessment by the respondent, with directions to independently apply mind and complete the exercise in accordance with the prescribed circular and the Narasus principle. The assessee obtained relief on the legality of the reassessment process, while the substantive assessments were left open for reconsideration.

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