Case Note & Summary
The petitioner, Greatship (India) Ltd., a company engaged in providing specialized services to oil and gas exploration and production entities, filed a writ petition under Articles 226/227 of the Constitution of India challenging assessment orders dated 20.03.2020 passed by the Assistant Commissioner of State Tax (respondent No.3) under the Maharashtra Value Added Tax Act, 2002 (MVAT Act) and the Central Sales Tax Act, 1956 (CST Act) for the financial year 2015-16, along with consequential notices of demand. The petitioner had discharged service tax under the Finance Act, 1994 for the relevant period. On 01.02.2018, respondent No.3 issued notices of assessment calling upon the petitioner to produce documents and show cause why it should not be assessed under Section 23 of the MVAT Act. The petitioner responded on 03.05.2018 submitting the required documents. Thereafter, on 22.11.2019, respondent No.3 again called for documents, and the petitioner informed that documents had already been submitted. No further steps were taken until 20.03.2020, when respondent No.3 passed ex-parte assessment orders without considering the petitioner's earlier submissions and without granting any personal hearing. The limitation period for assessment under Section 23(2) of the MVAT Act for the financial year 2015-16 expired on 31.03.2020. The petitioner contended that the assessment orders were passed in violation of principles of natural justice and sought their quashing. The respondents argued that the petitioner had not cooperated and that the orders were passed within limitation. The court, after hearing both sides, held that the assessment orders were passed in gross violation of natural justice as the petitioner's submissions were not considered and no opportunity of hearing was granted. The court quashed the assessment orders and the consequential notices of demand, and remanded the matter to respondent No.3 for fresh assessment after giving the petitioner a reasonable opportunity of hearing, including the right to produce documents and be heard. The court directed that the fresh assessment be completed within six months from the date of the order.
Headnote
A) Constitutional Law - Writ Jurisdiction - Articles 226/227 of the Constitution of India - Quashing of Assessment Orders - Petitioner challenged ex-parte assessment orders passed without considering its earlier submissions and without granting personal hearing - Court held that the orders were passed in violation of principles of natural justice and set them aside, remanding the matter for fresh assessment after giving the petitioner an opportunity of hearing (Paras 2, 9-10). B) Value Added Tax - Assessment - Section 23 of the Maharashtra Value Added Tax Act, 2002 - Ex-Parte Assessment - The assessing officer issued notice, petitioner submitted documents, but officer did not consider them and passed ex-parte assessment orders on the last day of limitation - Court held that the orders were unsustainable as they violated natural justice and directed fresh assessment after hearing the petitioner (Paras 5-10). C) Central Sales Tax - Assessment - Central Sales Tax Act, 1956 - Ex-Parte Assessment - Similar to MVAT assessment, the CST assessment order was also passed ex-parte without considering petitioner's submissions - Court quashed the order and remanded for fresh assessment after hearing (Paras 2, 9-10).
Issue of Consideration
Whether the assessment orders dated 20.03.2020 passed ex-parte under the MVAT Act and CST Act are sustainable when the petitioner had already submitted documents and the assessing officer did not consider them or grant a personal hearing before passing the orders.
Final Decision
The court quashed the assessment orders dated 20.03.2020 and the consequential notices of demand, and remanded the matter to respondent No.3 for fresh assessment after giving the petitioner a reasonable opportunity of hearing, including the right to produce documents and be heard. The fresh assessment to be completed within six months from the date of the order.
Law Points
- Natural justice
- right to be heard
- ex-parte assessment
- limitation period
- MVAT Act
- CST Act
