(Per : HONOURABLE MR.JUSTICE AKIL KURESHI) 1) Rule. Ms.Trusha Mehta, Learned Assistant Government Pleader waives service of notice of Rule on behalf of the respondents.
2) Petition is taken up for hearing forthwith.
3) Petitioners have challenged the order dated 7.2.2012 passed by the Gujarat Value Added Tax Tribunal (hereinafter to be referred to as “the Tribunal”).
4) Brief facts are as follows:
4.1) Petitioners were registered with the Sales Tax authority as well as the authority under the Gujarat Value Added Tax Act (hereinafter to be referred to as “the VAT”). On 10.11.2009, an application came to be made for cancellation of registration under the VAT Act. From the application it is clear that cancellation of registration was requested with effect from 1.10.2009. On such application, the Commercial Tax Officer, Dhrangadhra, passed an order dated 15.7.2010 and granted cancellation with effect from 1.10.2009 on the ground of discontinuation of the business.
4.2) Subsequently, however, the Deputy Commissioner of VAT issued a notice dated 16.11.2010, purported to be under section 27(5) of the VAT Act, calling upon the petitioner No.1-Mehul Trading Company why the registration should not be cancelled. The reason for such proposal was shown to be as the business was discontinued and communication thereof was not sent to the authorities. Yet another notice dated 11.1.2011 came to be issued by the same authority again on the petitioner No.1 under section 75 of the VAT Act, calling upon the petitioners to show-cause why the registration should not be cancelled since such registration was obtained only with the purpose of defrauding the Government Revenue.
4.3) It appears that Shri Chandulal Nagardas Shah, the proprietor of the petitioner No.1 Trading Company, had expired on 1.2.2010. No representation on behalf of the petitioner No.1, therefore, came to be made before the authorities in response to the above noted notices. The Deputy Commissioner proceeded to pass ex-
parte order on 29.1.2011. He cancelled the registration ab-initio. Such order came to be challenged by the petitioners before the Tribunal. The Tribunal noted that the notices were issued to a dead person. There was, thus, clear breach of requirement of service of notice. The Tribunal, therefore, was of the opinion that the Deputy Commissioner's order should be set aside. Additionally, the Tribunal also referred to the order dated 15.7.2010 passed by the Commercial Tax Officer and expressed an opinion that such order should also be cancelled. In the result, the Tribunal passed the following order:-
“10) In view of this we are of the view that notice issued on 16.11.2010 to Mr. Chandulal Nagardas Shah after his death on 01.02.2010, is not properly served to the applicant and so order dated 29.1.2011 is also not properly passed in this behalf because the said order has been passed against a dead man.
11) In view of the above discussion, we quash and set aside the order dated 15.7.2010 as well as order dated 29.1.2011 and request the learned authority to find out the legal heir and representatives of Mr. Chandulal Nagardas Shah and thereafter issue notices to them and thereafter, after hearing them may pass fresh order in this behalf.
12) We make it clear that when the Revenue desired to pass order, earlier order cancelling the registration dated 1.10.2009, should also be considered while passing fresh order in this behalf. The written submission and the record of the Revising authority which Mr. Thakore has reproduced be produced before the Revising authority also and Revising Authority will give an opportunity of being heard to the proper legal heir or representative of Mr. Chandulal Nagardas Shah and thereafter, after duly applying his mind, may pass order accordingly. The authority will also consider the submissions made by Mr. Mehta which we have recorded earlier in our order particularly in para 7 of the order.
13) The legal heirs and representatives may also give details regarding their transactions with M/s. Shasandev Cotton Company, M/s. Roopan International, M/s. Laxmi Corporation and M/s. Om Enterprise also with whom according to Revenue, those transactions were entered into only for billing purpose.
14) The Tribunal is making it clear that we have set aside the order dated 15.7.2010 as well as order dated 29.1.2011. The Tribunal has not expressed any opinion on merits of the matter and it will be open for the Revising authority to pass fresh order without being influenced by the observations made by the Tribunal.”
5) Having heard learned counsel for the parties and having perused the documents on record, it clearly emerges that the order dated 15.7.2010, which the Commercial Officer passed, was not in challenge before the Tribunal. What the petitioners had challenged before the Tribunal was the order dated 29.1.2011 passed by the Deputy Commissioner. If the Tribunal found that such order was passed without adequate notice to the petitioners, the Tribunal was justified in quashing such order and permitting further process in accordance with law. However, by no reason, the Tribunal could have quashed the order dated 15.7.2010, which was not in challenge at the hands of the petitioners or the respondents. Whether such order is open to question in accordance with law, is an issue which we are not called upon to decide. Despite such order dated 15.7.2010, whether the Deputy Commissioner could pass any further orders either in exercise of powers under section 27(5) of the Act or under section 75 of the Act, we are not inclined to give any final decision on such aspect. Suffice it to say that even while upholding the Tribunal's order quashing the Commissioner's order dated 29.1.2011 and remanding the proceeding for further consideration, we cannot approve the Tribunal quashing the order dated 15.7.2010 passed by the Commercial Tax Officer.
6) In the result, the petition is allowed to the limited extent of reversing the order of the Tribunal insofar as the same quashed the Commercial Tax Officer's order dated 15.7.2010. Rest of the order is left unaltered. The Authority shall proceed further as provided by the Tribunal in the impugned order. For such purpose, to avoid any uncertainty about service of notice, the petitioner No.2 will remain present before the Deputy Commissioner, Rajkot, on 15.10.2012. No notice of such hearing will be required to be issued to the petitioners. It is made clear that the date is fixed only for convenience, and if, for some reason, it is not convenient to the Deputy Commissioner to take up the hearing on such date, it would be open for him to adjourn the proceeding to some suitable date.
7) With the above directions, the petition is disposed of. Rule is made absolute accordingly with no order as to costs.
(AKIL KURESHI,J.) (HARSHA DEVANI,J.) Vahid