M/S.Hotel Theni International vs. The Assistant Commissioner (CT)

Held

The Court held that there was merit in the petitioner's submission that the respondent's failure to deal with the request for furnishing details constituted a violation of the principles of natural justice. The Court noted that unless the petitioner is put on notice of the material sought to be used in framing the assessment, they would have difficulty responding to the proposal. The Court extracted a portion of the assessment order which acknowledged the petitioner's request for details but proceeded to confirm the proposal without addressing it. Consequently, the Court found the impugned order dated 11.12.2018 to be vitiated. The Court set aside the impugned order and directed the respondent to proceed with the assessment in accordance with law, after furnishing the details sought by the petitioner and granting a reasonable opportunity of hearing.

Facts

The petitioner, M/s. Hotel Theni International, represented by its partner Vinoth Mathew, filed a writ petition challenging an order of assessment dated 11.12.2018 for the assessment year 2007-08, passed by the Assistant Commissioner (CT), Theni II Assessment Circle. The assessment was based on an inspection by the Enforcement Wing, which found that the petitioner supplied free snacks and complimentary breakfast, but the Input Tax Credit (ITC) claims were not supported by relevant documents, and an intranet website revealed mismatches. The petitioner had requested specific details and documents from the respondent on 24.10.2017, prior to the impugned order. The respondent argued that a personal hearing was granted and reiterated the grounds for assessment.

Key Issues

1. Whether the impugned assessment order dated 11.12.2018, passed for the assessment year 2007-08, is vitiated by a violation of the principles of natural justice, specifically concerning the respondent's failure to deal with the petitioner's request for details and documents, as required under Section 27 of the TNVAT Act, 2006? Petitioner's contentions: The petitioner argued that the respondent passed the impugned order without furnishing the requested details and without considering their objections, thereby violating the principles of natural justice. They contended that without the requested information, they were unable to respond adequately to the proposed assessment. Respondent's contentions: The respondent contended that a notice of personal hearing was granted and reiterated the grounds set out in the assessment order.