Nataraja Oil Mills PVT. LTD. vs. The State Tax Officer

Held

The Court held that the impugned order dated 29.06.2018 passed by the respondent was unsustainable. It was found that the order was passed without proper application of mind and without considering the objections raised by the petitioner, including the judgments relied upon. The Court emphasized that a personal hearing is not a mere formality and the authority must effectively consider objections to do substantial justice. The respondent, acting as a quasi-judicial authority, failed to provide any reasons or discussions on the petitioner's objections or the case law presented. This failure to consider the materials amounted to a non-speaking order and a clear violation of the principles of natural justice. Consequently, the impugned order was set aside. The matter was remitted back to the respondent for fresh consideration, with a direction to pass orders on merits and in accordance with law, uninfluenced by the Enforcement Wing's report, and after providing an opportunity for a personal hearing within four weeks.

Facts

The petitioner, Tvl. Nataraja Oil Mills Pvt. Ltd., a dealer of edible oil registered under the Tamil Nadu Value Added Tax Act, 2006, filed returns for the assessment year 2015-16 claiming exemption on turnover as per Form-WW. Following an inspection by Enforcement Wing Officials in October 2015, which revealed certain defects, the respondent, The State Tax Officer, issued a revision notice dated April 6, 2018. The petitioner submitted a detailed reply on May 14, 2018, and a subsequent letter on June 19, 2018, relying on various judgments concerning stock differences and Input Tax Credit reversal. A personal hearing was scheduled for June 19, 2018, where the petitioner stated that all original documents had been submitted. Despite this, the respondent issued an impugned order on June 29, 2018, stating that the objections were examined and proposals confirmed, without addressing the petitioner's specific objections or the cited case law.

Key Issues

1. Whether the impugned order dated 29.06.2018 passed by the respondent is vitiated by a non-application of mind and a violation of the principles of natural justice, particularly concerning the consideration of the petitioner's objections and relied-upon judgments? Petitioner's Arguments: The petitioner contended that the respondent failed to apply his mind to the objections filed and did not consider the judgments cited in their reply. They argued that the personal hearing was a mere formality and the respondent's order was a non-speaking order, issued without due consideration of the materials presented, thus violating principles of natural justice. Respondent's Arguments: The respondent did not present any arguments on record. The judgment states, "Heard the submissions on both sides," but only details the petitioner's case and the Court's reasoning. Therefore, no specific arguments were recorded for the respondent.