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2022 DIGILAW 239 (GUJ)

Ethnicity Limited v. State of Gujarat

2022-02-09

J.B.PARDIWALA, NISHA M.THAKORE

body2022
JUDGMENT : J.B. PARDIWALA, J. 1. Rule returnable forthwith. Mr. Utkarsh Sharma, the learned AGP waives service of notice of rule for and on behalf of the respondents nos. 1, 2 and 3 respectively. 2. By this writ application under Article 226 of the Constitution of India, the writ applicant/a dealer has prayed for the following reliefs: "(a) That this Hon'ble Court be pleased to issue a Writ of Certiorari, or a Writ in the nature of Certiorari, or any other appropriate Writ, Order or direction, calling for the papers and proceedings leading to the records relating to Order dated 26.10.2020 passed by Ld. VAT Tribunal and after looking into the same and the legality thereof, this Hon'ble Court be pleased to: (i) Quash and set aside the Order dated 26.10.2020 passed by Ld. VAT Tribunal (Annexure-G); (ii) Quash and set aside the letter dated 18.01.2022 issued by the Ld. Assistant Commissioner of Sales Tax, Ahmedabad to Respondent No. 4 (Annexure-H); (b) That this Hon'ble Court be pleased to issue a Writ of Mandamus, or a Writ in the nature of Mandamus, or any other appropriate Writ, Order or direction to the Ld. Assistant Commissioner of Commercial Tax, Ahmedabad to pass fresh Assessment order after following the principles of Natural Justice; (c) That pending the hearing and final disposal of the present Petition, this Hon'ble Court be pleased to direct the Respondents, their servants, agents, officers and subordinate, restricts them from acting on or in consequence of the impugned the Order dated 26.10.2020 passed by Ld. VAT Tribunal (Annexure-G) and stay the operation and implementation of the impugned Order dated 26.10.2020 passed by Ld. VAT Tribunal (Annexure-G); d) for ad-interim relief in terms of prayer (C) above; (e) for costs of the petition be provided; and (f) for such further and other reliefs, as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case." 3. It appears from the materials on record that the writ applicant is engaged in the business of retail and trading of ethnic wear for women, men and children. On 26.03.2018, the writ applicant received an ex-parte assessment order for the financial year 2013-14 passed by the Assistant Commissioner of Commercial Tax, Ahmedabad under Section 32 read with Section 34 and Section 35 respectively of the Gujarat Value Added Tax Act, 2003 (for short, 'the VAT Act'). 4. On 26.03.2018, the writ applicant received an ex-parte assessment order for the financial year 2013-14 passed by the Assistant Commissioner of Commercial Tax, Ahmedabad under Section 32 read with Section 34 and Section 35 respectively of the Gujarat Value Added Tax Act, 2003 (for short, 'the VAT Act'). 4. It is the case of the writ applicant that it had no idea or any knowledge as regards the assessment proceedings undertaken by the Assistant Commissioner. In such circumstances, the writ applicant did not participate in the assessment proceedings. The Assistant Commissioner directed the writ applicant to pay an amount of Rs. 26,40,005/- (tax-11,89,192 + interest-8,56,218 + penalty-5,94,596/-). 5. Being dissatisfied with the ex-parte assessment order referred to above, the writ applicant preferred an appeal under Section 73(1) of the VAT Act before the respondent no. 3 on various legal grounds. The writ applicant also made a request to waive the pre-deposit for the purpose of entertaining the appeal under Section 73(4) of the VAT Act, 2003. The respondent no. 3 vide order dated 07.07.2018, summarily dismissed the appeal filed by the writ applicant on the ground of non payment of pre-deposit of the amount of Rs. 2,50,000/-. 6. It appears that thereafter, the Office of the Commercial Tax Department, Unit-8, addressed a notice to the respondent no. 4-Bank asking the bank to debit an amount of Rs. 27,03,497/- along with interest from the account of the writ applicant and transfer it to the Government Treasury within seven days from the date of receipt of notice in terms of Section 44 of the VAT Act. The writ applicant made a request to the respondent no. 3 to provide him a copy of the assessment order dated 26.03.2018. The writ applicant being aggrieved with the order dated 07.07.2018 passed by the respondent no. 3 dismissing the appeal preferred an appeal along with the stay application and delay condonation application before the VAT Tribunal. The Tribunal declined to condone the delay and accordingly, the second appeal came to be dismissed. In such circumstances referred to above, the writ applicant is here before this Court with the present writ application. 7. We have heard Mr. Hardik Modh, the learned counsel appearing for the writ applicant and Mr. Utkarsh Sharma, the learned AGP appearing for the State respondents. 8. In such circumstances referred to above, the writ applicant is here before this Court with the present writ application. 7. We have heard Mr. Hardik Modh, the learned counsel appearing for the writ applicant and Mr. Utkarsh Sharma, the learned AGP appearing for the State respondents. 8. We are of the view that one opportunity should be given to the writ applicant to question the legality and validity of the ex-parte order of assessment dated 26.03.2018 passed by the Assistant Commissioner of Commercial Tax. This matter was taken up for hearing in the first session and at that point of time, we inquired with Mr. Modh whether his client would be ready and willing to deposit an amount of Rs. 5,00,000/- with the Assessing Officer. Mr. Modh, made a request to keep the matter at 2:30 p.m. to enable him to obtain necessary instructions from his client. Mr. Modh has reverted to us with necessary instructions. The client of Mr. Modh i.e. the writ applicant is ready and willing to deposit an amount of Rs. 5,00,000/- with the Assessing Officer by day after tomorrow i.e. 11.02.2022. 9. Once the amount of Rs. 5,00,000/- is deposited with the Assessing Officer, the writ applicant shall produce the proof of such deposit with the respondent no. 3 herein and proceed to hear the appeal against the original order of assessment dated 26.03.2018 passed by the Assessing Officer. For that purpose, the respondent no. 3 shall restore the appeal to its original file. The respondent no. 3 shall hear the appeal on its own merits and decide the same in accordance with law. Since the writ applicant has agreed to deposit an amount of Rs. 5,00,000/- and upon such deposit, the appeal against the final order of assessment is to be heard on merits, the department shall not insist with the bank i.e. the respondent no. 4 to transfer the amount of Rs. 50,00,000/- in accordance with the notice which is at page 56 of the paper book, Annexure-I and also permit the writ applicant to utilize the said amount. 10. The respondent no. 3 shall take up the appeal for hearing at the earliest and decide the same in accordance with law. We clarify that we have otherwise not expressed any opinion on the merits of the case. 11. With the aforesaid, the writ application stands disposed of.