M/S.Jasmine Towels Private Ltd v. The Assistant Commissioner(Ct)
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 01.12.2021
CORAM
THE HON'BLE MR. JUSTICE M.SUNDAR W.P(MD)Nos.17547 to 17550 of 2015 and M.P.(MD)Nos.1, 1, 1 and 1 of 2015 M/s.Jasmine Towels Private Limited, Represented by its Director Ritan N.Thakker, No.125, Aruppukottai Main Road, Perungudi, Madurai.
... Petitioner in all W.Ps.
Vs.
The Assistant commissioner (CT), Thirupparankundram Assessment Circle, Madurai.
... Respondent in all W.Ps.
COMMON PRAYER: Petitions filed under Article 226 of the Constitution of India, for the issuance of a Writ of Certiorarified Mandamus, call for the records on the file of the respondent in TIN.No.33456230736/2010-11, TIN.No.33456230736/201112, TIN.No.33456230736/2012-13 and TIN.No.33456230736/2013-14 dated 30.06.2015 and quash the same as illegal and contrary to the provisions of the Act and direct the respondent to pass a assessment order afresh after affording the opportunity of being heard. For Petitioner : Mr.S.Karunakar (In all W.Ps) For Respondent : Mr.M.Lingadurai, (In all W.Ps) Special Government Pleader.
COMMON ORDER This common order will govern the captioned main four writ petitions.
2. Captioned four writ petitions have been filed assailing four separate revisional orders dated 30.06.2015. To be noted, these revisional orders are under Sections 27 of 'Tamil Nadu Value Added Tax Act, 2006 (Tamil Nadu Act 32 of 2006)', which shall hereinafter be referred to as 'TNVAT Act' for the sake of convenience and clarity. These four revisional orders pertain to four different assessment years viz., 2010-11, 2011-12, 2012-13 and 2013-14 qua writ petitioner / dealer under TNVAT Act and they bear reference TIN.No.33456230736/2010-11, TIN.No.33456230736/2011-12, TIN.No.33456230736/2012-13 and TIN.No.33456230736/2013-14. These four revisional orders have been assailed in the main writ petitions and therefore, the same shall be collectively be referred to as 'impugned orders'.
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3. Mr.S.Karunakar, learned counsel for writ petitioner submitted that the writ petitioner is a manufacturer and exporter of terry towels, there was deemed assessment qua writ petitioner under Section 22(2) of TNVAT Act with regard to the aforementioned assessment years. Thereafter, the place of business of the writ petitioner was inspected by Enforcement Wing Officers on 21.01.2014 and it was pointed out that the writ petitioner has not reversed ITC for manufactur of exempted goods as per Section 19(5)(a) of TNVAT Act. Pursuant to the proposals of Enforcement Wing, according to the respondent pre-revisional notices dated 18.08.2014 were issued to the writ petitioner, the same were received by the writ petitioner on 31.08.2014 but the writ petitioner-dealer did not reply and did not produce any records. To be noted, this is recorded in the impugned orders.
4. Learned counsel for writ petitioner submits that no prerevisional notices were served and therefore, in the previous listing on 15.11.2021, the following proceedings were made: 'The central issue in the captioned writ petitions is whether pre-revisional notices dated 18.08.2014 was served on the writ petitioner-dealer on 31.08.2014 as mentioned in the impugned orders.
2. Learned counsel for writ petitioner draws the contention of this Court to Rule 19 of the 'Tamil Nadu Value Added Tax Rules, 2007' ( hereinafter 'said Rules' for convenience and clarity) and submits that the same has not been served on the writ petitioner in accordance with Rule 19.
3. This Court finds that the writ petitioner has not chosen to file a rejoinder to the counter-affidavit of the Revenue refuting the assertion in the counteraffidavit that 18.08.2014 pre-revisional notices were served on the writ petitioner on 31.08.2014.
4. However, with the intention of dousing this controversy, learned Revenue counsel shall produce the records in the next listing.
5. List after a fortnight.
6. List on 01.12.2021.'
5. Pursuant to the aforementioned proceedings, 18.08.2014. pre-revisional notices (4 notices) with what according to the respondent are acknowledgements were placed before this Court and the same are as follows:
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6. Learned State Counsel submits that the pre-revisional notices have been duly served on the writ petitioner-dealer and therefore, the complaint of writ petitioner does not hold water. Learned State Counsel also pointed out that this has been asserted in the counter affidavit filed by the lone respondent and it has also been recorded in the impugned orders.
7. In response to the above, learned counsel for writ petitioner drew the attention of this Court to Rule 19 of 'Tamil Nadu Value Added Tax Rules, 2007' ('TNVAT Rules' for brevity) which reads as follows:
'19. Service of notices, summons or orders.- (1) The service on a dealer of any notice, summons or order 10/13
under the Act or these rules may be effected either electronically or manually in any of the following ways, namely: - (a) by giving or tendering it to such dealer or his manager or agent or the legal practitioner appointed to represent him or to his authorised representative; or Explanation.- Endorsement by person who delivers the notice, summon or order of having tendered or given will be proof for the purpose of this sub-rule.
(b) if such dealer or his manager or agent or the legal practitioner appointed to represent him, or his authorised representative is not found, by giving or tendering it to any adult member of his family; or (c) by sending it to the address of the dealer by registered post; or (d) if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place of business or residence in the presence of two independent witnesses.'
8. In the case on hand, obviously, the service going by the respondent records has been made under Rule 19(1)(a) of TNVAT Rules. If it is under Rule 19(1)(a), explanation to rule 19(1)(a) assumes significance. A perusal of the explanation would make it clear that the person, who delivers the notice should have made an endorsement and such endorsement will be proof for the purposes of Sub-rule (1) (a). In the instant case, there is no such endorsement in the extracts from the records which have been placed before this Court. The writ petitioner counsel emphatically submits that the preassessment notices were not served on writ petitioner and the signature there is not that of anyone concerned with the writ petitioner.
9. Therefore, I am of the considered view that this is a fit case to give the benefit of doubt to the writ petitioner-dealer. This means that it has not been conclusively established {vide explanation to Rule 19(1)(a) of TNVAT Rules} that the pre-revisional notices dated 18.08.2014 have been duly served on the writ petitioner-dealer on 31.08.2014. This further means that the impugned orders will have to be interfered with on this short point and the writ petitioner-dealer has to be given opportunity afresh to show cause.
10. Opportunity afresh to show cause is owing to common proviso to sub-Section (1) and (2) of Section 27 of TNVAT Act, which reads as follows:
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'27. Assessment of escaped turnover and wrong availment of input tax credit.- (1)(a)......
(b).......
(2) Provided that no order shall be passed under subsections (1) and (2) without giving the dealer a reasonable opportunity to show cause against such order.'
11. To be noted, this Court in State Bank of India Officer's Association case being W.P.No.22634 of 2019 [State Bank of India Officer's Association (CC) - SBIOA Vs. The Assistant Commissioner (ST), Chennai], dated 01.08.2019 has made it clear that the expression 'reasonable opportunity to show cause' occurring in aforementioned common proviso to Sub-Sections (1) and (2) of Section 27 does not mean 'personal hearing' and it only means reasonable opportunity to show cause in contradistinction to proviso to Section 22(4) of TNVAT Act where personal hearing is imperative. It was also made clear that personal hearing is entirely at the discretion of the Assessment Officer depending on the facts and circumstances of any given case. The above is mentioned only for clarity and specificity qua this order.
12. In the light of the narrative and discussion thus far, captioned four writ petitions are disposed of by making the following order:
a) Impugned orders being orders dated 30.06.2015, bearing reference Nos.TIN.No.33456230736/2010-11, TIN.No.33456230736/2011-12, TIN.No.33456230736/ 2012-13 and TIN.No.33456230736/2013-14 are set aside on the short point that it has not been conclusively established {qua explanation to Rule 19(1)(a) of TNVAT Rules} that pre-revisional notices have been served on the writ petitioner and therefore, there is infraction of the common proviso to Section 27(1) and 27(2) of TNVAT Act, which makes it statutorily imperative to give a reasonable opportunity to the writ petitioner-dealer to show cause against the impugned orders;
(b) Though obvious it is made clear that this Court has not expressed any view or opinion on the merits of the matter;
(c) The four pre-revisional / assessment notices are now furnished to the learned counsel for writ petitioner and therefore, the writ petitioner-dealer should respond to the same i.e., show cause within a fortnight from today i.e., on or before 15.12.2021. In response to the 12/13
pre-revisional assessment notices, it is open to the writ petitioner to furnish supporting documents; and d) Thereafter, the Assessing Officer shall do Section 27 of TNVAT Act legal drill i.e., revisional legal drill on the merits of the response of the writ petitioner-dealer in accordance with law and make orders as expeditiously as possible as his business would permit and in any event within two months from 15.12.2021 i.e., on or before 15.02.2022.
13. Captioned writ petitions are disposed of with the above directives. Consequently, connected captioned writ miscellaneous petitions are disposed of as closed. There shall be no order as to costs.
Sd/- Assistant Registrar (CS-III) // True Copy // / /2021 Sub Assistant Registrar(CS) vsm 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.
To The Assistant commissioner (CT), Thirupparankundram Assessment Circle, Madurai.
+1 CC to M/s.S.KARUNAKAR, Advocate ( SR-36851[F] dated 01/12/2021 ) +1 CC to M/s.SPL GP ( SR-37035[F] dated 02/12/2021 ) W.P(MD)Nos.17547 to 17550 of 2015 and M.P.(MD)Nos.1, 1, 1 and 1 of 2015 01.12.2021 SS(CO) GC(15.12.2021) 13P 4C 13/13