Fair hearing in tax assessment requires notice and reply before final orders; proposed arbitral scrutiny of revision notices was rejected.

Assessment orders passed without awaiting the assessee's reply and without clear notice of hearing were held unsustainable, because a fair adjudicatory process requires that objections be received and considered before final determination. The orders were therefore quashed and the matter remitted for fresh consideration after calling for the assessee's reply. A separate request to appoint a Joint Commissioner to examine the legality of the revision notices was rejected, as the statutory framework under the Tamil Nadu Value Added Tax Act, 2006 did not provide for the proposed arbitral mechanism; the proper course was to file objections to the notices and seek a reasoned decision on merits.

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Issues: (i) Whether the assessment orders were liable to be quashed for being passed without awaiting the assessee's reply and representation and without proper notice of hearing; (ii) Whether the request to appoint a Joint Commissioner to examine the legality of the revision proceedings was warranted under the statutory scheme.

Issue (i): Whether the assessment orders were liable to be quashed for being passed without awaiting the assessee's reply and representation and without proper notice of hearing.

Analysis: The assessment arose from surprise inspection and subsequent revision notices. The assessee had sought time and requested that its representation for transfer of the matter be considered before final orders were made. The impugned orders were passed without a reply on merits and without ensuring that the assessee was clearly informed that the matter would be taken up for hearing. In these circumstances, the orders did not reflect a proper adjudicatory process and the matter required fresh consideration.

Conclusion: The assessment orders were quashed and the matter was remitted for fresh decision after calling for the assessee's reply.

Issue (ii): Whether the request to appoint a Joint Commissioner to examine the legality of the revision proceedings was warranted under the statutory scheme.

Analysis: The request proceeded on the footing that a higher officer should be appointed to arbitrate on the validity of the revision notices. The statutory framework under the Tamil Nadu Value Added Tax Act, 2006 did not contemplate such appointment for testing the correctness of the revision notices in the manner sought. The appropriate course was to file objections to the notices and await a reasoned determination on merits.

Conclusion: The request for appointment of a Joint Commissioner as an arbitrator was not accepted.

Final Conclusion: The writ petitions succeeded only to the extent of setting aside the assessment orders and directing fresh consideration on merits after receipt of reply, while declining the request to have the revision notices examined through the proposed arbitral mechanism.

Ratio Decidendi: A quasi-judicial assessment order cannot be sustained when passed without ensuring a fair opportunity to the assessee and without a reasoned adjudication on objections, and a statutory scheme will not be expanded to create an arbitral mechanism where none is provided.

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