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M/s. Vishal Collection Versus The Assistant Commissioner (CT) , The Commercial Tax Officer, The Deputy Commissioner (CT) , The Joint Commissioner (CT)

2016 (9) TMI 1160 - MADRAS HIGH COURT

Revision of assessment - inspection of the place of business by the Enforcement Wing Officials of the Commercial Taxes Department - Tamil Nadu Value Added Tax, 2006 - hosiery garments - local sales of cloth and inter-State sale of garments with stitching charges, sale ratio of garments - hosiery garments sales within the State are camouflaged as cloth sales - entire cloth sale disallowed and treated as hosiery garment sales - notice issued by Assessing officer without applying his mind and solel .....

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7 - MADRAS HIGH COURT] is relied upon. It was held that by merely endorsing the findings of the Inspecting Authorities and implementing in-toto, the Assessment Proceedings which were issued without independent thinking by the authority, are condemnable. - The notice issued by the Assessing Officers dated 10.05.2016 itself is defective and it is an outcome of total non-application of mind as it is a verbatim repetition of the observations of the Enforcement Wing Officials. This is clear becau .....

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Sivagnanam, J. For the Petitioner : Mr.P.Rajkumar For the Respondents : Mr.S.Kanmani Annamalai ORDER Heard Mr.P.Rajkumar, learned counsel appearing for the petitioner in all Writ Petitions and Mr.S.Kanmani Annamalai, learned Additional Government Pleader, accepting notice on behalf of respondents in all Writ Petitions. With the consent of the learned counsel on either side, these Writ Petitions are taken up for final disposal. 2. The petitioner-Company is a manufacturer of hosiery garments as we .....

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t Wing Officials had prepared a report and forwarded the same to the first respondent-Assessing Officer, to revise the assessments for the years 2007-08, 2008-09, 2009-10, 2010-11, 2011-12, 2012-13, 2013-14, 2014-15 and 2015-16 respectively. During the course of investigation by the Enforcement Wing Officials, a statement was recorded from the Proprietor of the petitioner. The allegation made against the petitioner was that on verification of the local sales of cloth and inter-State sale of garm .....

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nd inter-State sales of garments and stitching charges, is not supported by any comparative statement and it is vague and without such details, the petitioner cannot offer any remarks. It was further pointed out that the sales of hosiery garments within the State have been camouflaged as sales of cloth, is also not supported by any evidence or incriminating records to substantiate the claim of the Department. Therefore, the petitioner categorically stated that two allegations made against them a .....

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Enforcement Wing Officials to the first respondent. Be that as it may, the first respondent issued notices proposing to revise the assessments already completed and from a perusal of the notices, it is evidently clear that it is a verbatim repetition of the allegation made by the Enforcement Wing Officials against the petitioner, which has been recorded in the statement given by the petitioner to the Enforcement Wing Officials on 25.01.2016. 5. Thus, it is prima-facie clear that the Assessing O .....

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ections and it goes without saying that the first respondent being a quasi-judicial Authority, has failed to apply his mind. That apart, it was stated that the notice dated 10.05.2016 is absurd and not going to serve any useful purpose. Placing reliance on the decision of the Hon'ble Division Bench of this Court in the case of Madras Granites P. Ltd., Vs. CTO, Arisipalayam Circle reported in 2006 (146) STC 642 (Mad), the petitioner stated that by merely endorsing the findings of the Inspecti .....

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the proposals in the notices, by stating that in the reply/objections filed by the petitioner, dated 25.05.2016, there is no objection as such and the contention raised by the petitioner is vague by merely blaming the Department and therefore, the objection was over-ruled. 6. The impugned assessment orders, in these cases, are a classical example of how an Assessing Officer should not function in spite of repeated decisions of this Court, pointing out the role of the Assessing Officer and it app .....

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Enforcement Wing Officials, who are entitled to either accept or reject the views taken by the Assessing Officer. In the event the Enforcement Wing Officials rejects the objection raised by the Assessing Officer, to the the "D-3" proposal, it appears that there is a direction to the Assessing Officer to complete the assessment as per the proposal. If such is the inter-departmental directions, then, the impugned assessment proceedings are a farce. It appears that the entire procedure fo .....

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he Hon'ble Division Bench of this Court, while considering the effect of such "D-3" proposal, had condoned the arbitrary in the manner in which the Assessing Officer had functioned. At this stage, it will be worthwhile to refer to the operative portion of the said judgement of the Division Bench in Madras Granites (P) Ltd., Vs. Commercial Tax Officer, Arisipalayam Circle (referred to supra):- "Therefore, when the higher officer, viz., the Assistant Commissioner (CT), Enforceme .....

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i-judicial authority and in exercising his quasi-judicial function of completing the assessment, he is not bound by the instructions or directions of the higher authorities. We find that in both the matters the assessing officer has acted on the basis of the directions of his higher authority in completing the assessments. We hold that the assessments are not sustainable in law. Accordingly, the orders of assessment in both the matters are liable to be quashed and consequently, the orders of the .....

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