IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 25TH JANUARY 2011 / 5TH MAGHA 1932 WP(C).No. 1919 of 2011(L) ---------------------------------------- PETITIONER(S): ----------------------- M/S.CONCEPT WOOD & METAL INDUSTRIES, KADUNGALLOOR ROAD, THOTTAKKATTUKARA.P.O., ALUVA-8, REP.BY ITS MANAGING PARTNER, SRI.C.G.ANTONY. BY ADVS. SRI.E.P.GOVINDAN, SMT.G.DEEPA. RESPONDENT(S): --------------------------- 1. THE COMMERCIAL TAX OFFICER, COMMERCIAL TAXES, ALUVA. 683 101. 2. THE INSPECTING ASST.COMMISSIONER, COMMERCIAL TAXES, MATTANCHERRY. 682 002. 3. THE STATE OF KERALA, REPRESENTED BY THE SECRETARY, TAXES DEPARTMENT, GOVERNMENT SECRETARIAT, TRIVANDRUM. 695 001. R1 TO R3 BY SR. GOVERNMENT PLEADER SRI. C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25/01/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.1919 of 2011 ------------------------------------------- Dated this the 25th day of January, 2011 J U D G M E N T ---------------------- Challenge in this writ petition is against Ext.P3 & P4 revised orders of assessments passed under Section 25(1) of the Kerala Value Added Tax Act, 2003 (KVAT Act), with respect to the years 2008-'09 and 2009-'10. The petitioner is challenging validity of those orders of assessments, without resorting to the statutory remedy of appeal available, on the ground that the impugned orders are per se illegal and unsustainable under law. 2. Allegation of the petitioner is that those orders are issued in violation of principles of natural justice and also without proper adherence to the mandatory procedure contemplated under the relevant provisions. It is the complaint of the petitioner that with respect to Ext.P3, when the proposal notice was received he had filed detailed reply. But thereafter the assessing authority has not afforded any opportunity of personal hearing to the petitioner. It is evident on the face of Ext.P3 that the objections submitted by the petitioner was considered by the authority and took a decision thereon, without calling the petitioner for any personal hearing. It is settled law that the personal hearing as contemplated under Section 25(1) is not an empty formality and that the denial of any such W.P.(C).1919/11 -2- opportunity will vitiate the order if any passed. The petitioner is placing support of the above proposition by referring to Suzion Infrastructure Service Ltd. Vs. C.T.O. (2010 (3) KHC 299). 3. With respect to Ext.P4 order of assessment, learned Government Pleader appearing for the respondents specifically points out that the petitioner had not even filed any objection against the proposal notice, and therefore there is no relevance in contending denial of opportunity for personal hearing. However, learned counsel for petitioner submits that the proposal notice was not duly served to any authorised person available at the place of business and that the petitioner was not aware about such notice. However, it is conceded that one of the employees, who was in charge during the relevant period, had subsequently left the service of the petitioner due to serious misconduct and misappropriation detected. Further contention of the petitioner is that both Ext.P3 & P4 assessments were completed based on inspections conducted and the alleged irregularities detected. Contention of the petitioner is that the assessing authority ought to have done an independent evaluation regarding the merits of the alleged suppressions and assessment could not be completed merely relying on the findings arrived by any officer of the Intelligence Wing while conducting inspection. In this regard the petitioner relies on the dictum laid down by this court in the W.P.(C).1919/11 -3- decision in YESES International Vs. State of Kerala ((2009) 23 VST 130 (Ker)). 4. Considering the above contentions and the facts and circumstances discernible from the records, I am of the view that at least with respect to Ext.P3 order there is a clear denial of opportunity for personal hearing, which will vitiate sustainability of that order. Considering the fact that the revised assessment orders are issued with respect to both the years, I am of the view that interest of justice will be served if the petitioner is afforded with a further opportunity with respect to both the assessments. 5. Therefore the writ petition is allowed. Ext.P3 and P4 are hereby quashed. The petitioner is given liberty to file objections or additional objections with respect to both assessment years and also to produce books of accounts or documents in support of his claims. 6. Fresh orders in this regard shall be issued by the 1st respondent after affording an effective opportunity of personal hearing to the petitioner as early as possible, at any rate within a period of one month from the date of receipt of a copy of this judgment. C.K.ABDUL REHIM, JUDGE. okb