Madras High Court
Tvl. Rahul Agencies vs The State Tax Officer on 6 September, 2021
W.P(MD) Nos.15887 to 15890 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 06.09.2021
CORAM
THE HON'BLE MR.JUSTICE R.SURESH KUMAR
W.P(MD)Nos.15887 to 15890 of 2021
and
W.M.P.(MD)Nos.12799, 12802, 12803 & 12805 of 2021
Tvl. Rahul Agencies
Rep. by its Proprietor K.R.Kannan,
No.5/217A, Meenampatti,
Sivakasi. : Petitioner in all Writ Petitions
-Vs-
The State Tax Officer,
Sivakasi II,
Sivakasi. : Respondent in all Writ Petitions
Common Prayer: Writ Petitions filed under Article 226 of Constitution
of India, to issue Writs of Certiorari, calling for the records on the file of
the respondent in TIN No:33105981396/2011-12, 2012-13, 2013-14 and
2014-15 dated 29.07.2021 and quash the same as illegal, invalid and
against the principles of natural justice.
For Petitioner : Mr.A.Chandrasekaran
For Respondents : Mr.R.Sureshkumar
Government Advocate
[In all Writ Petitions]
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W.P(MD) Nos.15887 to 15890 of 2021
COMMON ORDER
The prayer sought in these Writ Petitions are for issuance of Writs
of Certiorari, calling for the records on the file of the respondent in TIN
No:33105981396 for the assessment years 2011-12, 2012-13, 2013-14
and 2014-15 dated 29.07.2021 and quash the same.
2. Since the issue raised in these writ petitions is one and the same,
with the consent of the learned counsel appearing for the parties, all
these writ petitions were heard together and are being disposed of by this
common order.
3. The petitioner is an assessee with TIN No.33105981396 under
the respondent. He is a dealer in edible oils and he is an assessee on the
file of the respondent, under the Tamil Nadu Value Added Tax Act, 2006
[hereinafter referred to as “the Act”] and the petitioner claimed to have
reported their purchases and sales in their regular monthly returns and
paid taxes and other amounts due thereon, after deducting Input Tax
Credit (ITC), available to them as per the Act and Rules framed
thereunder.
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4. In respect of assessment year 2011-12 to 2014-15, returns were
filed and that shall be deemed to be the completed returns as per the
provisions of Section 22(2) of the Act. However, the Enforcement Wing
of the respondent on 11.11.2014, conducted an inspection at the
petitioner's place of business and pursuant to which, their cases were
reopened and ultimately, orders of assessment were issued on
22.03.2018.
5. Challenging those orders, the petitioner had approached this
court in the first round of litigation, by filing writ petitions in W.P.
(MD)Nos.7933 to 7936 of 2018. The said writ petitions came to be
disposed of by a short order of the Writ Court dated 04.03.2021, which
reads thus:
“Heard the learned Counsel on either side.
2.The orders impugned in these writ petitions
are liable to be set aside because personal hearing
was not given to the petitioner herein. It is
accordingly quashed. These writ petitions are
allowed. The matters are remitted to the file of the
assessing authority to pass orders afresh in
accordance with law. No costs. Consequently,
connected miscellaneous petitions are closed.”
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W.P(MD) Nos.15887 to 15890 of 2021
6. Therefore, those writ petitions were allowed by the writ Court,
only on the ground that personal hearing was not given to the petitioner.
7. According to the petitioner, the personal hearing includes the
supply of documents which are heavily relied upon by the respondent /
revenue against the petitioner in concluding the reassessment procedure.
In this context, the petitioner seems to have sought for certain documents
to be furnished and only in that context, the respondent / Revenue,
pursuant to the order passed by the writ Court in W.P.(MD)Nos.7933 to
7936 of 2018, dated 04.03.2021, as quoted hereinabove, had issued
notices on 06.07.2021, giving an opportunity of personal hearing to the
petitioner for each assessment years during 2011-12 to 2014-15.
8. On receipt of those notices and in response to the same, the
petitioner has given separate replies to the respondent on 12.07.2021,
where the petitioner has specifically asked for the production of
documents or supply of documents. However, on receipt of such reply
from the petitioner assessee, when the petitioner was expecting that the
documents sought for by the petitioner would be supplied to the
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W.P(MD) Nos.15887 to 15890 of 2021
petitioner, the respondent has sent summons dated 14.07.2021 that, on
22.03.2021, the petitioner shall appear for personal hearing. In response
to the same, the petitioner again on 23.07.2021, has given a reply cum
request, where he had asked for or insisted for supply of the documents
which he had already asked for. However, the respondent has proceeded
to pass the final order of assessment dated 29.07.2021, separately for
each of the assessment years, without supplying those documents
requested by the petitioner. Thereby, the petitioner felt aggrieved over
the said orders of assessment dated 29.07.2021, in all these cases, have
filed these writ petitions with respective prayers.
9. Heard, Mr.A.Chandrasekaran, learned counsel appearing for the
petitioner, who would submit that, as against the impugned assessment
orders, normally, the assessee has to go before the appellate authority.
However, as an exception to the same, if the principles of natural justice
is violated and for want of jurisdiction or alleged violation of statutory
provisions, the assessee or aggrieved party can approach this court
directly by invoking the extraordinary jurisdiction of this Court under
Article 226 of the Constitution of India. Therefore, in this context, the
learned counsel for the petitioner would submit that, here, in the case in
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W.P(MD) Nos.15887 to 15890 of 2021
hand, principles of natural justice has been violated, despite the earlier
order of remand made before this Court in the first round of litigation as
referred above.
10. He would further submit that, when specifically certain
documents are going to be utilized against the petitioner and a specific
request to that effect has been again and again made by the petitioner, the
same has been brushed aside and simply admitted in the impugned order
itself that, those documents have been shown to the dealers by the
inspecting officer. Therefore, admittedly, those documents have not been
furnished and no reason whatsoever has been given for not furnishing the
documents. In this context, the learned counsel for the petitioner has
relied upon a decision of this court of a Division Bench reported in
(2006) 146 STC 25 [Mad], in the matter of Kwality Granites and
Marbles Vs. The Registrar, Tamil Nadu Taxation Special Tribunal and
another dated 19.02.2004, where he relied upon the following findings
given by the Division Bench:
“5.We find that the order of Special Tribunal as
well as the order of the assessing officer are not
sustainable as admittedly the enforcement wing has
seized the 62 slips from the assessee's premises and they
were in the possession of the enforcement wing.
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W.P(MD) Nos.15887 to 15890 of 2021
Later,\these records were transferred to the assessing
authority. The enforcement wing and the assessment wing
are different. The mere fact that the assessee was given
the opportunity for perusing the D7 records by the
Enforcement Wing Officer would not be sufficient
compliance of the principles of natural justice by the
assessing officer as the assessee requested the assessing
officer to furnish the copies of the D7 records at his cost
so that he could reply the pre-assessment notice after the
D7 records came into the hands of the assessing officer
for the purpose of making assessment. We find that the
view of the assessing officer that it is not necessary for
him to furnish the copies of the said documents is not
sustainable as without these copies, the assessee may not
be in a position to give his effective reply to the pre-
assessment notice. Further, the assessing officer has
relied upon those documents to arrive at the taxable
turnover of the assessee. Since the petitioner was
prevented from sending his effective reply to the pre-
assessment notice, we hold that the order of assessment
impugned in the writ petition was made in violation of the
principles of natural justice and therefore it is liable to be
quashed.”
11. By relying upon the said decision, the learned counsel would
contend that, mere showing the documents which are required to be
furnished is not enough or not the sufficient compliance of the principles
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W.P(MD) Nos.15887 to 15890 of 2021
of natural justice by the assessing authority. Therefore, the statement
given by the assessing authority in the impugned orders that the
Inspection Officer has shown the documents to the dealer is not
sufficient to fulfill the requirements of principles of natural justice and
therefore, on that ground, the impugned orders are vitiated. Therefore,
the petitioner is having every justification in approaching this Court
under Article 226 of the Constitution of India, challenging the impugned
orders. Therefore, he seeks indulgence of this court.
12. Per contra, Mr.R.Sureshkumar, learned Government Advocate
appearing for the respondent, on instructions, would submit that, the
documents which are required by the petitioner whether to be given
copies to him itself is a question, in view of the provisions under Section
85 of the TNVAT Act, wherein, there has been a prohibition of
disclosure of particulars produced before the authority, as strict
confidentiality has to be maintained. Hence, he relies upon Section 85(1)
of the TNVAT Act, which reads thus:
“85. Prohibition of disclosure of particulars
produced before tax authorities.-
(1) All particulars contained in any statement
made, return furnished or accounts, registers,
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W.P(MD) Nos.15887 to 15890 of 2021
records or documents produced under the
provisions of this Act or in any evidence given or
affidavit or deposition made, in the course of any
proceeding under this Act or in any record of any
proceeding relating to the recovery of a demand,
prepared for the purposes of this Act shall be
treated as confidential and shall not be disclosed.”
13. By relying upon the said provision, the learned Government
Advocate would submit that, for the purpose of perusal of the documents
in question, those documents were given or shown to the petitioner /
dealer and even after that has been shown to him, the petitioner cannot
further seek supply of copies of the documents, which are confidential
documents. Therefore, such confidentiality has to be maintained by the
assessing authority, in view of Section 85(1) of the Act. Therefore, the
petitioner has no right to claim the copies of the documents which are
confidential one, being maintained by the assessing authority sought to
be furnished to the petitioner. Instead, if those documents are shown for
perusal of the petitioner dealer, that would be sufficient to meet the
principles of natural justice. Therefore, in the present case, such kind of
principles of natural justice since has not been violated, the petitioner
cannot have any grievance that, such principle has not been followed.
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Therefore, on that ground, the petitioner cannot invoke the extraordinary
jurisdiction of this court under Article 226 of Constitution of India, by
filing the present writ petitions and if at all the petitioner has got any
grievance over the orders of assessment which are impugned herein, he
can prefer appeals before the appellate authority under the provisions of
the Act and without exhausting such remedy, the petitioner ought not to
have come before this court. Therefore, on that ground, the writ petitions
are liable to be dismissed, he contended.
14. I have considered the rival submissions made by the learned
Counsel for the parties and have perused the materials placed before this
court.
15. It is a fact that, though the petitioner has already filed the
returns as a deemed acceptance of returns, subsequently, on inspection
that has been carried out in the business premises of the petitioner,
further, the cases were reopened for the four assessment years as referred
to above and ultimately, that ended in re-assessment orders and those
assessment orders have been challenged before this Court in the first
round of litigation, on the only ground of violation of principles of
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natural justice. The learned Judge allowed those writ petitions by order
dated 04.03.2021, remanding the matter to the assessing authority for
reconsideration in accordance with law.
16. When such an order of remand was received, the assessing
authority normally would be expected to act upon, by following the
procedures established in law in conducting and concluding the
assessment procedures.
17. In this context, though notices had been given on 06.07.2021
by the Revenue to the petitioner, those notices were replied promptly by
the petitioner assessee on 12.07.2021, where these issues had been
raised. Nevertheless, the respondent further went ahead and issued
summons on 14.07.2021, to the petitioner to appear on 23.07.2021, by
way of personal hearing. In response to the same, the petitioner vide his
further reply dated 23.07.2021, had requested specifically the
respondent / Revenue to furnish the documents which are essential and
crucial from the point of view of the petitioner, to effectively defend his
case.
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18. In this context, the impugned orders say that personal hearing
was given to the petitioner dealer, but the dealer has not given any
documentary evidence to drop the proceedings. With reference to the
supply of certain documents, the Inspection Officers had shown the
documents to the dealers.
19. These findings given in the impugned orders itself makes it
clear that, by accepting the showing of some of the documents by the
Inspection Officers to the petitioner itself is sufficient to meet the point
that the documents sought for by the petitioner had been furnished to the
satisfaction of the petitioner and by thus, the principles of natural justice
has been followed according to the respondent.
20. However, if we look at the principles laid down by the
Division Bench of this Court in Kwality Granites and Marbles case cited
supra, it has been specifically held that, mere giving of opportunity to the
assessee for perusing the documents would not be sufficient compliance
of the principles of natural justice by the assessing officer.
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21. Exactly, the same has happened in these cases, where a chance
of perusal of the documents seems to have been given to the petitioner,
but the copies of the same has not been furnished to the petitioner.
22. In this context, even though Section 85(1) of the TNVAT Act
has been heavily relied upon by the learned Government Advocate for
the respondent / Revenue, on perusal of Section 85(1) of the Act, it
makes it clear that the particulars contained in any statement made, return
furnished or accounts, registers, records or documents produced under
the provisions of this Act or in any evidence given or affidavit or
deposition made, in the course of any proceeding under this Act or in any
record of any proceeding relating to the recovery of a demand, prepared
for the purposes of this Act shall be treated as confidential and shall not
be disclosed.
23. Insofar as this provision to maintain the confidentiality is
concerned, it may be a confidential document insofar as a third party is
concerned. However, if those documents are going to be utilized as
against the dealer or assessee and if any adverse order is going to be
passed, certainly, the petitioner / assessee will be entitled to have such
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document, which is a fundamental and rudimentary part of the principles
of natural justice. Therefore, Section 85(1) cannot be interpreted in such
a meaning as interpreted by the Revenue side. Moreover, that could be
the possible interpretation in view of the judgment cited supra in Kwality
Granites and Marbles case.
24. If the said principle is applied to the facts of the present case,
since admittedly the Revenue has not furnished the documents to the
petitioner, but it has only been shown to the petitioner, certainly, this
Court can safely conclude that, the degree of principles of natural justice
in the expected line has not been met in this case by the action of the
assessing authority. Therefore, the petitioner can have a successful
challenge of these orders which are impugned herein.
25. In that view of the matter, this court is inclined to dispose of
these writ petitions with the following order:
“the impugned orders are quashed and the matters
are remitted to the respondent / assessing authority for
reconsideration. While reconsidering the same, the copies of
the documents sought for by the petitioner shall be furnished
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to the petitioner within a period of two weeks and on receipt
of the same, the petitioner shall have two [2] weeks time to
respond by way of written reply with supportive documents
and on receipt of the reply with supportive documents, if
any, the respondent / assessing authority shall provide
personal hearing within two [2] weeks thereafter. After
having completed the personal hearing, it is open to the
respondent / assessing authority to pass final orders of
assessment within four [4] weeks, thereafter.”
26. With the above directions, these writ petitions are disposed of.
However, there shall be no order as to costs. Consequently, connected
miscellaneous petitions are closed.
06.09.2021
Index : Yes/No
Internet : Yes/No
MR
Note: In view of the present lock down owing to
COVID-19 pandemic, a web copy of the order
may be utilized for official purposes, but, ensuring
that the copy of the order that is presented is the
correct copy, shall be the responsibility of the
advocate/litigant concerned.
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W.P(MD) Nos.15887 to 15890 of 2021
R.SURESH KUMAR, J.
MR
To
The State Tax Officer,
Sivakasi II,
Sivakasi.
Common Order made in
W.P.(MD)Nos.15887 to 15890 of 2021
Dated:
06.09.2021
https://www.mhc.tn.gov.in/judis
