MYSORE ELECTRICAL INDUSTRIES LTD Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) The petitioner, Mysore Electrical Industries Ltd., has challenged the legality of the re-assessment order dated 27.4.2017, passed by the Assessing Officer, whereby the Assessing Officer has directed the petitioner to pay a tax liability of Rs.23,72,289/-.

(2.) Briefly the facts of the case are that the petitioner is a Public Limited Company, incorporated under the Companies Act, 1956. It is engaged in the manufacture of Electrodes, Electroplating materials, Ferrous and non-Ferrous metals, wires and electrical instruments. It is a registered dealer under the provisions of Karnataka Value Added Tax Act, 2003 ('KVAT Act' for short), and the Central Sales Tax Act, 1956, ('CST Act' for short). According to the petitioner, it had submitted its monthly return of turnover in Form-100, duly declaring all the transactions, both under the KVAT Act, and CST Act for the Assessment Year 2010-2011. The petitioner had filed the returns of the turnover under Section 35 of the KVAT Act, and paid the taxes thereon. However, subsequently the Commissioner of Commercial Taxes, issued an assignment note to the Assistant Commissioner of Commercial Taxes, respondent No.2, for the purpose of auditing the books of accounts of the petitioner for the said assessment period. Consequently, a notice under Section 52(1)(b) of the KVAT Act, was issued to the petitioner relating to the verification of the documents. By the notice dated 21.1.2016, the petitioner was directed to produce the books of accounts of the relevant documents for verification. The petitioner had submitted the relevant books of accounts of the relevant documents. However, without issuing a second notice to the petitioner under Section 39 of the KVAT Act, the Assessing Officer, respondent No.2, has passed the re-assessment order dated 27.4.2017. Hence, the present petition before this Court.

(3.) Mr. K. M. Shivayogiswamy, the learned counsel for the petitioner, has vehemently contended that according to Section 39 of the KVAT Act, the re-assessment order can be passed only after giving the dealer an opportunity of hearing against such re-assessment. However, no such notice was ever issued to the petitioner. Hence, the petitioner was deprived of the opportunity of hearing. Thus, the right of the petitioner under the principles of natural justice have been violated by the Assessing Officer.