Kerala High Court (HC) chaired by Justice Gopinath P. quashed the proceedings of the Value Added Tax (VAT) recovery on the ground the legal heirs were not given notice.
The petitioner, one of deceased Bhagavathirajan’s legal heirs, Sreeram B., filed a Writ Petition. He was a merchant registered under the Kerala Value Added Tax Act, 2003, and expired on May 31, 2021. He managed his company as a sole proprietor. In 2014, a commercial tax officer conducted an audit at the late Bhagavathirajan’s business premises and issued an order (CTO).
The Late Bhagavathirajan challenged the order of CTO before the Deputy Commissioner (Appeals),who issued the order and remanded the matter for fresh consideration of the assessing authority.
The petitioner claimed that the assessing authority had issued an order by the Sales Tax Officer (STO) modified the order of assessment giving effect to order issued by Deputy Commissioner (Appeals), first appellate authority without issuing any notice to the legal heirs of late Bhagavathirajan.
In the meanwhile, Revenue Recovery proceedings were also initiated to recover amounts due under the original order of assessment of CTO.
The Single bench observed that the order of the STO does not reveal that the order was issued after affording any opportunity of hearing to the legal heirs of late Bhagavathirajan.
Further it was observed that the order issued by the STO could have been issued only with notice to the legal heirs of late Bhagavathirajan as the registration of the dealer was cancelled from 12.05.2022 on account of the death of late Bhagavathirajan.
The court observed that the principles of natural justice of ‘opportunity to be heard’ was violated.
The bench quashed the order of the STO and directed to pass fresh orders in terms of order of Deputy Commissioner (Appeals) after affording an opportunity of hearing to the writ petitioner.
The HC further instructed that the evaluation be finished after giving the petitioner an opportunity to be heard and a chance to provide any documents he might want to rely on.
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