Tirupati Chemicals Vs. Deputy Commissioner of Commercial Taxes (Audit 31) - Court Judgment

Excerpt:
- code of civil procedure, 1908.[c.a. no. 5/1908]. section 100: [n. kumar, j] decree in suit for declaration of title states appeal against it delay of 9 years and 7 months lower appellate court refusing to condone the delay and dismissed the appeal second appeal held, state which represent the collective cause of the community, does not deserve a litigant. refusing to condone the delay can result in a meritorious matter being thrown out, at the very threshold and cause of justice being defeated. the technicalities of procedure should yield to considerations which would promote public interest and substantial justice. when delay is condoned, the highest that can happen is that a case would be decided on merits after hearing the parties. when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred. delay was condoned. order of lower appellate court was set aside. matter remitted to lower appellate court for disposal of appeal on merits. section 5; condonation of delay - decree in suit for declaration of title states appeal against it delay of 9 years and 7 months lower appellate court refusing to condone the delay and dismissed the appeal second appeal held, state which represent the collective cause of the community, does not deserve a litigant. refusing to condone the delay can result in a meritorious matter being thrown out, at the very threshold and cause of justice being defeated. the technicalities of procedure should yield to considerations which would promote public interest and substantial justice. when delay is condoned, the highest that can happen is that a case would be decided on merits after hearing the parties. when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred. delay was condoned. order of lower appellate court was set aside. matter remitted to lower appellate court for disposal of appeal on merits. ordern.k. patil, j.1. the petitioner in these petitions is assailing the correctness of the reassessment order and demand notice in form vat-180 dated december 16, 2008, passed by the respondent under section 39(2) of the karnataka value added tax act (the kvat act, 2003) for the assessment period from april 2006 to march 2007 vide annexure g.2. the only grievance of the petitioner in these petitions is that, the petitioner is a partnership firm, registered under the provisions of the karnataka value added tax act, 2003, carrying on the activity of importing from outside country and also purchasing from outside the state of karnataka and locally slack wax, residue wax, paraffin wax, refined wax, etc., and selling the same in the state of karnataka and outside the state of karnataka. the petitioner being a registered firm, has filed monthly returns for the period from april 2006 to march 2007 in form vat-100 declaring the sales turnover of slack wax, residue wax and paraffin wax, refined wax, etc., specifically pointing out that value added tax is leviable at the rate of four per cent being industrial inputs falling under entry 30 of notification bearing no. fd:197:csl:2005(6) dated april 30, 2005. it is the further case of the petitioner that, for the purpose of then entry no. 35 of the third schedule, the industrial inputs have been specified according to heading and sub-heading numbers under the central excise tariff act. be that as it may, the petitioner has received notice from the assessing authority on november 27, 2008, under section 9(2) of the cst act, 1956, read with section 39(1) of the kvat act, 2003, vide annexure b. in pursuance of the said notice, the petitioner has sent a communication dated december 3, 2008, vide annexure c, requesting to grant twenty days time up to december 23, 2008, to enable him to give reply to the said notice, as his chartered accountant is out of station. when he could not get any reply from the respondent in pursuance of annexure c dated december 3, 2008, again, the petitioner has sent another communication-cum-reply on december 10, 2008 vide annexure d seeking for a personal hearing after december 20, 2008, on the ground that, his auditor/chartered accountant is coming back on december 17, 2008. instead of considering the request of the petitioner for granting personal hearing, the respondent has proceeded to pass the impugned reassessment order on december 16, 2008, vide annexure g. being aggrieved by the impugned order as referred above, the petitioner herein felt necessitated to present these writ petitions, seeking appropriate relief, as stated supra.3. i have heard learned counsel appearing for the petitioner and learned government pleader appearing for the respondent.4. after careful perusal of the order impugned passed by the respondent, it is manifest on the face of the order that the respondent has committed an error, much less material irregularity in proceeding to pass the impugned order, without considering the request made by the petitioner vide annexures c and d as referred above. the petitioner, vide annexure c has specifically requested for time up to december 23, 2008, and when he has not received any reply from the respondent, again, he has sent another communication dated december 10, 2008, wherein he has specifically referred that, his chartered accountant is coming on december 17, 2008, and therefore, the date of personal hearing may be fixed on december 20, 2008. the said reply has been duly received and acknowledged by the office of the respondent on december 10, 2008, itself. but except referring to the request made by the petitioner on december 10, 2008, the respondent being the competent authority, has not referred as to why he was declining to consider the request made by the petitioner, and only on the basis of the reply given by the petitioner in annexure d, he has concluded the proceedings. on careful perusal of the order, it emerges that no reasonable opportunity has been provided to the petitioner and the respondent has proceeded to pass the order unilaterally, that too without recording any specific and cogent reasons, as to why the request of the petitioner for personal hearing has not been considered by him. therefore, in view of not conducting proper enquiry and not affording reasonable opportunity to the petitioner, the order impugned passed by the respondent cannot be sustained and the same is liable to be quashed, without going further into the merits and demerits of this case.5. in the light of the facts and circumstances of the case as stated above, the writ petitions filed by the petitioner are disposed of as follows:(i) the writ petitions filed by the petitioner are allowed in part.(ii) the impugned reassessment order dated december 16, 2008, passed by the respondent vide annexure g, is hereby set aside.(iii) the matter stands remitted back to the respondent for reconsideration of the matter afresh and to take appropriate decision, in accordance with law, after affording reasonable opportunity of hearing to the petitioner and dispose of the same, as expeditiously as possible, at any rate, within a period of four weeks from the date of receipt of a copy of this order.(iv) the petitioner herein is directed to be present before the respondent, personally on january 19, 2009, at 3 p. m. and submit his written submissions, if any, along with the necessary documents to substantiate his case.(v) the respondent is directed to receive the written submissions, if any, to be submitted by the petitioner and proceed further in compliance with the above directions issued by this court.6. the learned government pleader is permitted to file memo of appearance for the respondent within two weeks from today.

Judgment:
ORDER

N.K. Patil, J.

1. The petitioner in these petitions is assailing the correctness of the reassessment order and demand notice in form VAT-180 dated December 16, 2008, passed by the respondent under Section 39(2) of the Karnataka Value Added Tax Act (the KVAT Act, 2003) for the assessment period from April 2006 to March 2007 vide annexure G.

2. The only grievance of the petitioner in these petitions is that, the petitioner is a partnership firm, registered under the provisions of the Karnataka Value Added Tax Act, 2003, carrying on the activity of importing from outside country and also purchasing from outside the State of Karnataka and locally slack wax, residue wax, paraffin wax, refined wax, etc., and selling the same in the State of Karnataka and outside the State of Karnataka. The petitioner being a registered firm, has filed monthly returns for the period from April 2006 to March 2007 in form VAT-100 declaring the sales turnover of slack wax, residue wax and paraffin wax, refined wax, etc., specifically pointing out that value added tax is leviable at the rate of four per cent being industrial inputs falling under entry 30 of Notification bearing No. FD:197:CSL:2005(6) dated April 30, 2005. It is the further case of the petitioner that, for the purpose of then entry No. 35 of the Third Schedule, the industrial inputs have been specified according to heading and sub-heading numbers under the Central Excise Tariff Act. Be that as it may, the petitioner has received notice from the assessing authority on November 27, 2008, under Section 9(2) of the CST Act, 1956, read with Section 39(1) of the KVAT Act, 2003, vide annexure B. In pursuance of the said notice, the petitioner has sent a communication dated December 3, 2008, vide annexure C, requesting to grant twenty days time up to December 23, 2008, to enable him to give reply to the said notice, as his chartered accountant is out of station. When he could not get any reply from the respondent in pursuance of annexure C dated December 3, 2008, again, the petitioner has sent another communication-cum-reply on December 10, 2008 vide annexure D seeking for a personal hearing after December 20, 2008, on the ground that, his auditor/chartered accountant is coming back on December 17, 2008. Instead of considering the request of the petitioner for granting personal hearing, the respondent has proceeded to pass the impugned reassessment order on December 16, 2008, vide annexure G. Being aggrieved by the impugned order as referred above, the petitioner herein felt necessitated to present these writ petitions, seeking appropriate relief, as stated supra.

3. I have heard learned Counsel appearing for the petitioner and learned Government Pleader appearing for the respondent.

4. After careful perusal of the order impugned passed by the respondent, it is manifest on the face of the order that the respondent has committed an error, much less material irregularity in proceeding to pass the impugned order, without considering the request made by the petitioner vide annexures C and D as referred above. The petitioner, vide annexure C has specifically requested for time up to December 23, 2008, and when he has not received any reply from the respondent, again, he has sent another communication dated December 10, 2008, wherein he has specifically referred that, his chartered accountant is coming on December 17, 2008, and therefore, the date of personal hearing may be fixed on December 20, 2008. The said reply has been duly received and acknowledged by the office of the respondent on December 10, 2008, itself. But except referring to the request made by the petitioner on December 10, 2008, the respondent being the competent authority, has not referred as to why he was declining to consider the request made by the petitioner, and only on the basis of the reply given by the petitioner in annexure D, he has concluded the proceedings. On careful perusal of the order, it emerges that no reasonable opportunity has been provided to the petitioner and the respondent has proceeded to pass the order unilaterally, that too without recording any specific and cogent reasons, as to why the request of the petitioner for personal hearing has not been considered by him. Therefore, in view of not conducting proper enquiry and not affording reasonable opportunity to the petitioner, the order impugned passed by the respondent cannot be sustained and the same is liable to be quashed, without going further into the merits and demerits of this case.

5. In the light of the facts and circumstances of the case as stated above, the writ petitions filed by the petitioner are disposed of as follows:

(i) The writ petitions filed by the petitioner are allowed in part.

(ii) The impugned reassessment order dated December 16, 2008, passed by the respondent vide annexure G, is hereby set aside.

(iii) The matter stands remitted back to the respondent for reconsideration of the matter afresh and to take appropriate decision, in accordance with law, after affording reasonable opportunity of hearing to the petitioner and dispose of the same, as expeditiously as possible, at any rate, within a period of four weeks from the date of receipt of a copy of this order.

(iv) The petitioner herein is directed to be present before the respondent, personally on January 19, 2009, at 3 P. M. and submit his written submissions, if any, along with the necessary documents to substantiate his case.

(v) The respondent is directed to receive the written submissions, if any, to be submitted by the petitioner and proceed further in compliance with the above directions issued by this Court.

6. The learned Government Pleader is permitted to file memo of appearance for the respondent within two weeks from today.