1. The captioned Writ Petitions are directed against seven (7) separate orders of even date, i.e., 20.08.2015. The impugned orders pertain to Assessment Years (A.Ys) 2007-2008 to 2013-2014.
2. It is pertinent to note that some of the issues dealt with in the impugned orders are common, while others do not find mention in the impugned orders. 2.1. It is, however, common ground between the parties before me, that, the following issues were part of the adjudication process before respondent No.2; these being: "i) Tax on difference in sales turnover in books of accounts and monthly VAT returns
ii) Tax computed on sale of goods at a price lesser than the cost of the goods
iii) Tax on miscellaneous income
iv) Tax on handling charges paid on transportation of goods
v) Disallowance of exemption of printed material on sale of brouchers
vi) Disallowance of exemption of aluminium domestic utensils on the sales of non-sticky fry pan and non-sticky tawa
vii) Disallowance of exemption claimed on the sales of sauce pan
viii) Disallowance of exemption claimed on the sales of floral set of 3T light."
3. A tabular chart has been supplied by the petitioner setting out the demand made by the respondent qua each of the issues pertaining to the concerned Assessment Year. For the sake of convenience, the said chart is extracted hereafter: S.No.
Issues Tax amount period wise (in INR) Total amount (in INR) Remarks 2007-08 2008-09 2009-10 2010-11 2011-12-
2012-13 2013-14 1 Tax on difference in sales turnover in books of accounts and monthly VAT returns 1,917 2,950 3,193 2,845
-
-
1,412 12,317 2 Tax computed on sale of goods at a price lesser than the cost of the goods 608,920 2,260,828
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9,895,302 10,273,52 16,059,659 12,072,737 51,170,998 3 Tax on miscellneous income 546 4,974
-
-
-
5,520 Issue dropped but still included in the final demand 4 Tax on handling charges paid on transportation of goods 83,189 151,023 263,146
-
-
-
-
497,358 5 Disallowance of exemption of printed material on sale of brouchers 1,415,760 1,680,766 2,385,210 2,177,671 1,587,809 250,545 140,016 9,637,777 Ignored that matter is already in appeal for 2007-08 and 2008-09 6 Disallowance of exemption of aluminium domestic utelsils on the sales of non-sticky fry pan and non-sticky tawa 518,985 207,093 87 93,870 135,717 149,494 27,419 1,132,665 Ignored that matter is already in appeal for 2007-08 7 Disallowance of exemption claimed on the sales of sauce pan
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-
-
-
180,747 83,204 10,002 273,953 8 Disallowance of exemption claimed on the sales of floral set of 3T light
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-
-
-
-
123,204 375 123,442 Total Tax amount 26,28,771 43,02,660 26,52,182 1,21,74,662 1,21,77,825 1,66,65,969 1,22,51,961 6,28,54,030 Total Penalty amount 13,14,386 21,51,330 13,26,091 60,87,331 60,88,913 83,32,985 61,25,981 3,14,27,017
4. At the outset, counsel for the petitioner submits that while the petitioner would have no difficulty in preferring statutory appeals qua issue Nos.(i) and (iii), it would want the Court to interfere with the impugned order with regard to issue No.(ii).
5. The record shows that notice in this Writ Petition was issued on 08.10.2015, when a conditional order of stay was granted qua the impugned orders. The condition imposed was that the petitioner was directed to deposit 25% of the balance tax as indicated in the impugned order of the concerned Assessment Year. Counsel for the petitioner says that, as ordered, the deposit of tax has taken place.
6. In so far as issue No.(ii) is concerned, counsel for the petitioner says that the impugned orders for AYs.2007-08, 2008-09 and 2010-11 to 2013-14 need to be interfered with, as there has been a breach of natural justice. 6.1. In this behalf, learned counsel for the petitioner says that the show cause notice in the first instance was issued on 12.11.2014, to which a reply was filed on 27.11.2014. 6.2. The record shows that, in effect, a rejoinder was issued by respondent No.2, on 16.6.2015. In the rejoinder, the respondent took the stand that the tax liability has been arrived at in accordance with the provisions of Section 24 of the Tamil Nadu Value Added Tax Act, 2006 (in short 'the 2006 Act'). Consequent thereto, the petitioner filed a sur-rejoinder, so to speak, dated 29.06.2015, followed by an additional submission dated 30.06.2015. 6.3. To be noted, in the sur-rejoinder dated 29.06.2015, the petitioner, raised several objections which can briefly be categorised under the following heads:
i) That Section 24 of the 2006 Act was not applicable to bonafide transactions.
ii) The guidelines mentioned in Rule 8(3) of the Tamil Nadu Value Added Tax Rules, 2007 ( in short, 'the 2007 Rules'), were not followed
iii) That the onus rested with the Assessing Officer to prove that sales at Re.1 were made with an intent to evade tax.
iv) That the notice was vague and lacked material particulars
v) That VAT/sales tax was payable only on the actual consideration payable by the buyer to the seller and
vi) That the demand raised was barred by limitation.
7. It is pertinent to note that, in the interregnum, the petitioner was given a personal hearing and, therefore, as indicated above, an additional submission was filed by the petitioner on 30.06.2015. 7.1. It is, thus, the stand of the petitioner that a bare perusal of the impugned orders pertaining to the relevant assessment years, to which, I have made a reference above, would show that, in so far as issue No.(ii) was concerned, none of the submissions, as set out in the sur-rejoinder dated 29.06.2015, were taken into consideration. 7.2. It is also the contention of the learned counsel for the petitioner that judgments were cited in support of the submissions made, which were neither discussed nor referred to in the impugned orders passed by respondent No.2 concerning the relevant assessment years.
8. On the other hand, Mr.K.Venkatesh, who appears for the respondents says that, principles of natural justice were complied with and the petitioner was granted personal hearing and, therefore, the only remedy available to the petitioner was to take recourse to an appropriate proceeding under the 2006 Act. 8.1. Learned counsel says that the petitioner, should, therefore, avail of the appellate remedy, even with regard to issue No.(ii).
9. I have heard learned counsels for the parties and perused the record as also the impugned orders.
10. A bare perusal of the impugned orders would show that the submission advanced on behalf of the petitioner with regard to the fact that the objections raised in the reply filed with respondent No.2, in particular, as reflected in sur-rejoinder dated 29.06.2015, have not been adverted to. Amongst the various objections taken in the sur-rejoinder, one of the more crucial objection appears to be with regard to limitation.
11. It is not disputed before me, by Mr.Venkatesh, that there is no reference in the impugned orders qua the concerned assessment years with regard to the objection taken that the demand is barred by limitation.
12. Therefore, having regard to the overall facts and circumstances, I am of the view that, there has been a breach of principles of natural justice, inasmuch as, the conclusions are not based on the objections raised and the materials placed before respondent No.2.
13. Accordingly, I am inclined to accept the prayer made on behalf of the petitioner, which is to set aside the impugned orders, pertaining to A.Ys.2007-08 to 2008-09 and 2010-11 to 2013-14 qua issue No.(ii), only. 13.1. It is ordered accordingly.
14. As prayed by the learned counsel for the petitioner, he would have liberty to prefer an appeal with regard to the remaining issues in accordance with the extant provisions of law.
15. Respondent No.2 will grant a fresh opportunity of hearing to the petitioner to present its case vis-a-vis issue No.(ii). In this behalf, respondent No.2 will issue a notice to the petitioner indicating the date, time and venue where the authorised representative of the petitioner would have to appear and present its case. After hearing the petitioner, respondent No.2 will pass a fresh order taking into account all the objections raised by the petitioner, including those taken in sur-rejoinder dated 29.06.2015.
16. In view of the fact that the Writ Petition was pending adjudication before this Court, in case, the petitioner were to take recourse to a statutory remedy, qua the remaining issues, the concerned forum, will take into account this aspect of matter and, if necessary, condone the delay, by relying upon the principles analogous to Section 14 of the Limitation Act, 1963.
17. Before I conclude, I may also record that the petitioner along with the captioned writ petitions had also filed another set of petitions, which were numbered as: W.P.Nos.31985 to 31991 of 2015. 17.1. In these Writ Petitions, a declaration was sought that
Sections 3(1),3(2) and
24 of the 2006 Act be declared as unconstitutional and/or ultravires the Articles 14, 19(1)(g) and 265 of the Constitution of India. A further relief was sought, which was, that Rule 8(3) of the 2007 Rules be declared, as ultravires Section 80 of the 2006 Act.
18. These Writ Petitions, however, came to be dismissed by a Division Bench of this Court, by virtue of the judgment dated 09.10.2015. 18.1. I am informed by the counsel for the petitioner that a Special Leave Petition (SLP) has been preferred against the said judgment. A copy of the order has been shown to me, by the counsel for the petitioner. The said order is indicative of the fact that leave has been granted vide order dated 07.12.2016, passed in SLP CC.Nos.23032-23038 of 2016, titled: M/s.Amway India Enterprises Pvt. Ltd. V. State of Tamil Nadu and another. 18.2. The order also shows that the delay has been condoned, while granting leave and that prayer for stay stands rejected.
18.3. These are aspects, which were noted for the purpose of good order and record.
19. Accordingly, the captioned Writ Petitions are disposed of in terms of the directions adverted to above. Resultantly, connected Miscellaneous Petitions are closed.
20. However, there shall be no order as to costs.