Allowed

Dhansar Engi. Co. Pvt. Ltd., v. State and Anr.

Rajasthan HC3 Mar 2016CW/11123/2013

Case brief

AI extract

What is this about?

The High Court allowed a writ petition against a tax assessment order imposing liability on equipment purchased by the petitioner. The Court quashed the order for being passed without a hearing, violating natural justice, and remanded the matter for a fresh assessment.

What did the court decide?

The impugned assessment order and demand notice are quashed. Matter remanded to the Assessing Authority to pass a fresh order after providing a hearing.

Dhansar Engi. Co. Pvt. Ltd., Vs State and Anr. — Service and Employment | Rajasthan HC (2016)

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DHANSAR ENGINEERING COMPANY PVT. LTD. VS. STATE OF RAJASTHAN & ANR. (S.B.CIVIL WRIT PETITION NO.11123/13)

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DHANSAR ENGINEERING COMPANY PVT. LTD. VS.

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STATE OF RAJASTHAN & ANR. (S.B.CIVIL WRIT PETITION NO.11123/13)

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Dated:- 3.3.16.

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HON'BLE MR.JUSTICE SANGEET LODHA

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Mr.Vinay Kothari, for the petitioner. Mr.V.K.Mathur with Mr.Dinesh Godara, for the respondents.

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By way of this writ petition, the petitioner has questioned legality of assessment order dated 18.6.13 passed by the Assistant Commissioner, Works Contract and Leasing Tax, Udaipur, for the assessment year 2008-09 under Rajasthan Tax on Entry of Motor Vehicles into Local Areas Act, 1988, read with Sections 24-26, 55 and 58 of Rajasthan Value Added Tax Act, 2013, creating a demand of tax and interest. Initially, the demand of tax and interest was quantified at Rs.38,77,244/- and Rs.18,61,017/- respectively, total Rs.57,38,321/-, which was later reduced to Rs.22,37,868/- by way of rectification order dated 12.8.13.

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Learned counsel appearing for the petitioner contended that the Hydrolic Excavator Dumpers etc. purchased by the petitioner are chain mounted and some are equipments of special type mounted on tyres adapted for use only in mines and though, mechanically propelled, move in the mines area only and are not equipped/suitable to travel on public roads on their own

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DHANSAR ENGINEERING COMPANY PVT. LTD. VS. STATE OF RAJASTHAN & ANR. (S.B.CIVIL WRIT PETITION NO.11123/13)

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2 power, however, the Assessing Authority, without there being any material or information on record showing that the equipments in question falls within the definition of 'motor vehicle' and without even extending an opportunity of hearing to the petitioner, proceeded to determine the liability for tax, interest and penalty. It is submitted that the huge demand has been created against the petitioner on the presumptive basis, without assigning any reason whatsoever for conclusion arrived at and therefore, the same deserves to be quashed.

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On the other hand, the counsel appearing for the respondents submitted that the order impugned is appealable before the Appellate Authority under Section 82 of the Act and therefore, there is no reason as to why the petitioner should be permitted to invoke the extra ordinary jurisdiction of this court under Article 226 of the Constitution of India, by passing the statutory remedy of appeal. Learned counsel submitted that the Dumpers purchased by the petitioner during the period in question are tyre mounted Dumpers which can be plied on the roads and are capable of being used for transportation of the goods, which have rightly been included in the category of 'motor vehicles' and therefore, the liability of the tax and interest assessed by the Assessing Authority, cannot be faulted with.

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Learned counsel for the respondents has produced original

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DHANSAR ENGINEERING COMPANY PVT. LTD. VS. STATE OF RAJASTHAN & ANR. (S.B.CIVIL WRIT PETITION NO.11123/13)

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3 record of the assessment proceedings, a perusal whereof in no manner suggest that before passing the assessment order, a reasonable opportunity of hearing was extended to the petitioner. On being asked by the court as to how the assessment order creating the huge liability against the petitioner, could have been passed by the Assessing Authority without extending an opportunity of hearing to it, the learned counsel had no answer.

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I have considered the rival submissions of the learned counsel and perused the material on record.

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Indisputably, the question with regard to liability of tax on the Dumpers treating them to be 'motor vehicle', alleged to have been purchased by the petitioner during the relevant assessment year, remains a debatable question. It is not in dispute that before holding the petitioner liable for payment of tax and interest, no opportunity of hearing was extended to it to defend the case set out.

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In the considered opinion of this court, on the facts and in the circumstances of the case, the action of the Assessing Authority in passing the assessment order creating huge liability against the petitioner in perfunctory manner, without extending an opportunity of hearing, is ex facie illegal, arbitrary and violative of elementary principle of natural justice.

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DHANSAR ENGINEERING COMPANY PVT. LTD. VS. STATE OF RAJASTHAN & ANR. (S.B.CIVIL WRIT PETITION NO.11123/13)

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1. Moreover, a bare look at the order impugned reveals that the conclusion arrived at by the Assessing Authority, for treating the Dumpers alleged to have been purchased by the petitioner as 'motor vehicle' and creating the huge liability as aforesaid, is not supported by any reason whatsoever and therefore, the same deserves to be quashed for this reason also.

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Coming to the availability of the remedy of appeal under the Act, suffice it to say that apparently, the order impugned creating huge liability against the petitioner, has been passed by the Assessing Authority in perfunctory manner, in gross violation of the principles of natural justice and therefore, this court is not inclined to relegate the petitioner to the statutory remedy of appeal.

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In the result, the petition succeeds, it is hereby allowed. The impugned assessment order dated 18.6.13, as modified vide order dated 12.8.13, passed by the Assistant Commissioner, Works Contract & Leasing Tax, Udaipur, for the assessment year 2008-09 and the demand notice issued pursuant thereto, are quashed and set aside. The matter shall stand remanded to the Assessing Authority to pass the assessment order afresh, after giving an opportunity of hearing to the petitioner in accordance with law. No order as to costs.

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(SANGEET LODHA),J.

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Aditya/

Dhansar Engi. Co. Pvt. Ltd., v. State and Anr.

Case brief

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Dhansar Engi. Co. Pvt. Ltd., v. State and Anr.

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