Havea Handles and Components Pvt. Ltd. vs The Assistant Commissioner

Mr. Kanmani Annamalai, learned Government Advocate (Taxes), takes notice for the respondent. With the consent of the learned counsel on either side, the writ appeals are taken up for final disposal at the admission stage itself.

The petitioner in W.P. Nos. 14584-14586 of 2014 is the appellant in these writ appeals. In the writ petitions, the petitioner challenged the proceedings of the respondent dated 28.02.2014 and the writ petitions were allowed and the impugned orders were set aside and the matter was remitted back to the respondent for consideration afresh with a condition that the writ petitioner shall deposit 10% of the tax amount as claimed in the orders impugned in the writ petition, directly to the respondent and also submit their objections, if any and on receipt of the same, the respondent was directed to consider the objections independently, after giving an opportunity of personal hearing to the petitioner and pass a speaking order afresh, as expeditiously as possible, in accordance with law.

The facts leading to the filing of the writ petitions have been narrated in the impugned common order passed in the writ petitions and therefore, it is not necessary to re-state the facts once again.

The learned counsel for the appellant/writ petitioner would contend that the learned Single Judge, having found that the impugned orders are unsustainable, had quashed the same and having done so, ought to have remitted the matter without passing any conditional order and in any event, if the amount of input tax credit is considered, then, there cannot be any liability to pay taxes in terms of the impugned demand notices and hence, prays for setting aside the order, insofar as imposing condition to deposit 10% of the tax as claimed in the demand notice.

Per contra, Mr. Kanmani Annamalai, learned Government Advocate (Taxes) would contend that the learned Single Judge has taken into consideration, the interest of revenue and imposed the conditional order and in the event of the claim of the appellant is sustained, they are entitled to get refund of the amount in accordance with law and therefore, it cannot be said that they have been put to prejudice and hence, prays for dismissal of these writ appeals.

It has to be pointed out, at this stage, that, once it has been found that the orders impugned in the writ petitions are unsustainable on account of violation of principles of natural justice, it is wholly unnecessary to impose any condition while remitting the matter for fresh adjudication and in the considered opinion of this Court, the direction given to the appellant/writ petitioner to deposit 10% of the tax amount as claimed in the demand notice, as a condition precedent to enquire into the matter, is unsustainable and the said portion of the order is liable to be set aside.

In the result, the writ appeals are allowed and the impugned order dated 06.06.2014 made in W.P. Nos. 14584-14586 of 2014 is set aside insofar as directing the appellant/writ petitioner to deposit 10% of the tax claimed in the demand notice and in other respects, the common order dated 06.06.2014 passed in the writ petitions, stands sustained. The appellant/writ petitioner is granted time till 24.07.2014 to submit their objections along with documents, if any and the respondent, on receipt of the same, is directed to consider the same independently and after giving opportunity of hearing, shall pass orders afresh, on merits and in accordance with law, as expeditiously as possible and not later than four weeks from the date of receipt of the objections. No costs. Connected Miscellaneous Petitions are closed. However, the payment of the first instalment if any, as per the order of the learned Single Judge, need not be returned to the appellant by the respondent, as it is subject to the order to be passed.