Madras High Court
M/S.V.R.Muthu & Bros vs The State Tax Officer – on 26 February, 2025
Author: G.R.Swaminathan
Bench: G.R.Swaminathan
W.A.(MD)Nos.2214 to 2217 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 26.02.2025
CORAM
THE HONOURABLE MR.JUSTICE G.R.SWAMINATHAN
AND
THE HONOURABLE MR.JUSTICE M.JOTHIRAMAN
W.A(MD)Nos.2214 to 2217 of 2021
and
C.M.P(MD)Nos.10972 to 10975, 10977, 10980 &
10982 of 2021 and 6981, 6983 to 6985 of 2024
W.A(MD)No.2214 of 2021:
M/s.V.R.Muthu & Bros,
Represented by its Partner,
No.443, Main Bazaar,
Virudhunagar. ... Appellant /
Petitioner
Vs.
The State Tax Officer – 1,
Virudhunagar – I Assessment Circle,
Virudhunagar. ... Respondent /
Respondent
Prayer: Writ Appeal filed under Clause 15 of Letters Patent Act to set
aside the order dated 15.11.2021 made in W.P(MD)No.20182 of 2021
and further direct the respondent to proceed and complete the assessment
for the assessment year 2011-12 after granting a reasonable time as
sought for by the appellant in the letters dated 20.09.2021 and
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W.A.(MD)Nos.2214 to 2217 of 2021
27.08.2021 in the light of the Division Bench judgment of this Court
dated 25.09.2001 made in W.P.No.8766 of 2000.
For Appellant : Mr.R.L.Ramani
Senior Counsel
for Mr.S.Raja Jeya Chandra Paul
For Respondent : Mr.R.Suresh Kumar
Additional Government Pleader
W.A(MD)No.2215 of 2021:
M/s.V.R.Muthu & Bros,
Represented by its Partner,
No.443, Main Bazaar,
Virudhunagar. ... Appellant /
Petitioner
Vs.
The State Tax Officer – 1,
Virudhunagar – I Assessment Circle,
Virudhunagar. ... Respondent /
Respondent
Prayer: Writ Appeal filed under Clause 15 of Letters Patent Act to set
aside the order dated 15.11.2021 made in W.P(MD)No.20183 of 2021
and further direct the respondent to proceed and complete the assessment
for the assessment year 2012-13 after granting a reasonable time as
sought for by the appellant in the letters dated 20.09.2021 and
27.08.2021 in the light of the Division Bench judgment of this Court
dated 25.09.2001 made in W.P.No.8766 to 8768 of 2000.
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W.A.(MD)Nos.2214 to 2217 of 2021
For Appellant : Mr.R.L.Ramani
Senior Counsel
for Mr.S.Raja Jeya Chandra Paul
For Respondent : Mr.R.Suresh Kumar
Additional Government Pleader
W.A(MD)No.2216 of 2021:
M/s.V.R.Muthu & Bros,
Represented by its Partner,
No.443, Main Bazaar,
Virudhunagar. ... Appellant /
Petitioner
Vs.
The State Tax Officer – 1,
Virudhunagar – I Assessment Circle,
Virudhunagar. ... Respondent /
Respondent
Prayer: Writ Appeal filed under Clause 15 of Letters Patent Act to set
aside the order dated 15.11.2021 made in W.P(MD)No.20184 of 2021
and further direct the respondent to proceed and complete the assessment
for the assessment year 2013-14 after granting a reasonable time as
sought for by the appellant in the letters dated 20.09.2021 and
27.08.2021 in the light of the Division Bench judgment of this Court
dated 25.09.2001 made in W.P.No.8766 to 8768 of 2000.
For Appellant : Mr.R.L.Ramani
Senior Counsel
for Mr.S.Raja Jeya Chandra Paul
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W.A.(MD)Nos.2214 to 2217 of 2021
For Respondent : Mr.R.Suresh Kumar
Additional Government Pleader
W.A(MD)No.2217 of 2021:
M/s.V.R.Muthu & Bros,
Represented by its Partner,
No.443, Main Bazaar,
Virudhunagar. ... Appellant /
Petitioner
Vs.
The State Tax Officer – 1,
Virudhunagar – I Assessment Circle,
Virudhunagar. ... Respondent /
Respondent
Prayer: Writ Appeal filed under Clause 15 of Letters Patent Act to set
aside the order dated 15.11.2021 made in W.P(MD)No.20185 of 2021
and further direct the respondent to proceed and complete the assessment
for the assessment year 2014-15 after granting a reasonable time as
sought for by the appellant in the letters dated 20.09.2021 and
27.08.2021 in the light of the Division Bench judgment of this Court
dated 25.09.2001 made in W.P.No.8766 to 8768 of 2000.
For Appellant : Mr.R.L.Ramani
Senior Counsel
for Mr.S.Raja Jeya Chandra Paul
For Respondent : Mr.R.Suresh Kumar
Additional Government Pleader
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W.A.(MD)Nos.2214 to 2217 of 2021
COMMON JUDGMENT
(Judgment of the court was delivered by G.R.SWAMINATHAN, J.)
These Writ Appeals are directed against the common order dated
15.11.2021 made in W.P(MD)Nos.20182 to 20185 of 2021. The assessee
is the writ petitioner / writ appellant. The assessee questioned the
assessment orders dated 28.09.2021 for the assessment years 2011-12 to
2014-15. The learned single Judge dismissed the writ petitions on the
ground that the assessee ought to avail the appeal remedy.
2.The learned Senior Counsel appearing for the appellant /
assessee reiterated all the contentions set out in the memorandum of
grounds of Writ Appeals. It is seen that the assessee originally filed
W.P(MD)Nos.11991 to 11994 of 2018 questioning the pre-revision
notices dated 11.05.2018 for the aforesaid assessment years. The writ
petition was disposed of by one of us (GRSJ) on 04.03.2021 in the
following terms:
“4.When this Court wanted to know the basis on
which the pre-revision notices have been issued,
Mr.Kumaresen, the present Commercial Tax Officer,
Virudhungar read out from the statement given by the
petitioner herein before the enforcement wing officials
during inspection. While such a statement may not be
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W.A.(MD)Nos.2214 to 2217 of 2021
binding on the petitioner herein, that can certainly
furnish cause of action for initiating proceedings under
Section 27 of the Tamil Nadu Value Added Tax Act. But
then, as rightly pointed out by the learned senior
counsel for the writ petitioner, details are absent. When
the pre-revision notice does not contain the relevant
particulars, it would be difficult for the assessee to
appropriately respond. However, there is considerable
merit in the stand of the respondent that at the stage of
show cause notice, the Writ Court should be highly
reluctant to interfere. Therefore, even while declining to
interfere with the impugned notices, I direct the
respondent to issue a supplemental notice enclosing the
relevant particulars. The petitioner has to necessarily
offer his explanation in time without entangling the
respondent in further litigation. The respondent will
consider the objections of the petitioner in the light of
the aforesaid circular dated 04.11.2013 and the relevant
provisions of law. If the respondent is not satisfied,
personal hearing will be granted and thereafter, orders
in accordance with law will be passed.”
Aggrieved by the same, the assessee filed W.A(MD)Nos.910 to 913 of
2021. The assessee was successful before the Hon'ble Division Bench
which vide order dated 28.04.2021 allowed the writ appeals in the
following terms:
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W.A.(MD)Nos.2214 to 2217 of 2021
“9. For the above reasons, these Writ Appeals are
allowed. The orders passed in the Writ Petitions are set
aside. Consequently, the prerevision notices are set aside
and these matters are remanded to the respondent. The
respondent is directed to issue a show cause notice to the
appellant directing them to produce all their books of
accounts and other records to examine them in the light
of the direction issued in the Circular, dated 04.11.2013
and ascertain as to whether there is any accumulation of
input tax credit on account of lesser sale price than the
purchase price. On perusal of the records and books of
accounts and other documents, the Assessing Officer
shall form a prima facie opinion and thereafter, issue
revision notice, cause sufficient opportunity to the
appellant to submit their objections and thereafter, after
affording an opportunity of personal hearing, complete
the assessment. In the event, the assessing officer is
satisfied on perusal of the records produced by the
assessee before them by examining it in terms of the
Circular issued by the Commissioner, then, it is well open
to the Assessing Officer to complete the assessment based
on such records and discussions with the assessee. The
above direction be complied with by the respondent
within four weeks from the date of receipt of a copy of this
judgment.”
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W.A.(MD)Nos.2214 to 2217 of 2021
3.Thereafter, the assessing officer issued notices dated 14.07.2021
calling upon the assessee to produce all the books of account and
documents on 03.08.2021. After receiving the said notice, the assessee
sent letter dated 30.07.2021 requesting time to produce the books of
account during the first week of September 2021. Without giving a
disposal to the said request, pre-revision notices were straightaway
issued on 03.09.2021. The assessee was called upon to offer their
objection on or before 20.09.2021. Personal hearing notice was also
issued on 20.09.2021. In response thereto, the assessee reiterated their
earlier request for further time. The assessee's request letter dated
27.09.2021 was received by the assessing officer on 28.09.2021. The
impugned order came to be passed on 28.09.2021. In the meanwhile, the
assessee filed W.P(MD)No.17985 to 17988 of 2021 challenging the pre-
revision notices dated 03.09.2021. The writ petitions were listed for
admission on 04.10.2021. When the matter was listed for admission, the
Department informed the learned Judge that final assessment orders had
already been passed. In that view of the matter, the writ petitions came
to be dismissed with liberty to the assessee to challenge the assessment
orders. Challenging the same, the assessee filed W.A(MD)Nos.1974 to
1977 of 2021. The writ appeals were dismissed on 28.10.2021. The
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W.A.(MD)Nos.2214 to 2217 of 2021
learned Senior Counsel appearing for the assessee points out that even
though the assessment orders were purportedly passed on 28.09.2021,
they appear to have been despatched only on 01.10.2021. The postal
receipt indicates that they were posted only on 03.10.2021. 03.10.2021
happens to be Sunday.
4.We therefore find considerable merit in the contention made by
the learned Senior Counsel that despatch was made only to frustrate the
writ proceedings instituted by the assessee questioning the pre-revision
notices dated 03.09.2021.
5.Though on the face of it, the assessee appears to have instituted
successive proceedings against the Department, on a careful perusal, we
are of the view that this cannot be put against the assessee. When pre-
revision notices were originally issued on 11.05.2018, the assessee was
successful in getting the same set aside vide order dated 28.04.2021 in
W.A(MD)Nos.910 to 913 of 2021. When the assessee was successful in
his endeavour, he cannot be blamed for having undertaken the said
exercise. Likewise, filing of W.P(MD)Nos.17985 to 17988 of 2021 and
filing of W.A(MD)Nos.1974 to 1977 of 2021 cannot also be put against
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W.A.(MD)Nos.2214 to 2217 of 2021
the assessee because he was only exercising his right to change the
proceedings initiated by the Department.
6.We are of the view that the assessee is entitled to succeed
because the Department had not adhered to the direction given by the
Hon'ble Division Bench vide order dated 28.04.2021 in W.A(MD)Nos.
910 to 913 of 2021. The Hon'ble Division Bench had permitted the
assessee to produce the books of account. The assessing officer was
mandated to examine them and issue pre-revision notices only after
forming prima facie opinion. In this case, the assessee had requested one
month time to produce the books of account. If the Department felt that
this request cannot be accepted, a formal rejection order should have
been issued. In this case, the assessing officer did not reject the dealers
request letter dated 30.07.2021 before issuing the pre-revision notice
dated 03.09.2021 or passing of final assessment order dated 28.09.2021.
7.We are more than satisfied that due opportunity was not given to
the assessee. Even before commencing the arguments, the learned Senior
Counsel submitted that they can be put on terms. The assessee undertook
to remit 20% of the tax demanded from the assessee. They only seek 4
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W.A.(MD)Nos.2214 to 2217 of 2021
weeks time. Subject to the assessee / appellant abiding by the
undertaking to remit 20% of the demanded tax as covered under the
impugned assessment orders, the orders impugned in the writ petitions as
well as the orders impugned in these writ appeals stand set aside. If the
assessee fails to honour undertaking given before this Court, the benefit
of this order would stand automatically recalled and the order passed by
the learned single Judge would stand confirmed.
8.The writ appeals are allowed accordingly. No costs.
Consequently, connected miscellaneous petitions are closed.
[G.R.S., J.] [M.J.R., J.]
26.02.2025
NCC : Yes / No
Index : Yes / No
Internet : Yes/ No
MGA
To
The State Tax Officer – 1,
Virudhunagar – I Assessment Circle,
Virudhunagar.
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W.A.(MD)Nos.2214 to 2217 of 2021
G.R.SWAMINATHAN,J.
AND
M.JOTHIRAMAN, J.
MGA
W.A(MD)Nos.2214 to 2217 of 2021
and
C.M.P(MD)Nos.10972 to 10975, 10977, 10980 &
10982 of 2021 and 6981, 6983 to 6985 of 2024
26.02.2025
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