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2017 (9) TMI 752 - HC - VAT and Sales TaxTaxability - lease agreement - operating lease - Acquisition of Assets - case of appellant is that the ownership of the goods lie solely with the petitioner, and this is totally different from a Term loan, wherein, it is in essence, an agreement for borrowing - Held that: - The respondent has no explanation to offer, as to why, the matter was not taken to the logical end, and after issuance of the notice, dated 31.05.2007, there has been a long gap of more than 7 years before the next notice issued, dated 29.04.2014. Even thereafter, for over nearly 1 1/2 years, nothing happened in respect of the petitioner's reply, dated 06.05.2014, and notice was issued on 27.08.2015, without reference to any of the earlier notices or reply notices given by the petitioner. Thus, to that extent, the entire procedural formalities adopted by the respondent is flawed and amounts to violation of principles of natural justice. When the respondent had taken up the matter for adjudication, he ought to have taken into consideration what had transpired earlier and what was on their record from 2007 onwards. This Court can safely presume that the respondent was not even aware of the earlier proceedings, which were initiated in the year 2007. So far as the legal position is concerned, even it is accepted that the nature of transaction done by the petitioner amounts to deemed sales, then, provision under Section 4 (2) of the TNVAT Act 2006 would stand attracted. The Writ Petitions are disposed of with a direction to the petitioner to treat the impugned proceedings as show cause notices, submit their detailed objections in writing within a period of 30 days from the date of receipt of a copy of this order.
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