High Court · 2025

W.P. Nos.19277 to 19279 of 2008IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 06.10.2025CORAM THE HONOURABLE MR. JUSTICE S.M.SUBRAMANIAMANDTHE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQW.P. Nos.19277 to 19279 of 2008M/s.Arulmurugan Mosaic Tilesrepresented by N.Karunanidhi,Managing Partner,1-A, 1-B, K.N.Palayam,Thanjavur Road, Pattukottai.... PetitionerVs.1.The Sales Tax Appellate Tribunal (Additional Bench), City Civil Court Buildings, Chennai – 104.2.The Deputy Commercial Tax Officer, Pattukottai – I.3.The Deputy Commercial Tax Officer(Enforcement) I, Mannargudi. ... RespondentsWrit Petitions filed under Article 226 of The Constitution of India praying for the issuance of a Writ of Certiorari to call for the records on the file of the first respondent in T.A.Nos.845/02, 846/02 and 847/02 dated 06.02.2007 relating to the years 1991-92, 1992-93 and 1993-94 and quash the same as being without jurisdiction, invalid and illegal and violative of principles of natural justice.Page 1 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008For Petitioner: Mr.K.Narayanan in all WPsFor Respondents: Mr.V.Prashant Kiran, Government Advocate (Taxes) for R2 and R3 in all WPs R1 – Tribunal in all WPsCOMMON ORDER(Order of the Court was made by MOHAMMED SHAFFIQ, J.) The present writ petitions are filed challenging the order of the Tamil Nadu Sales Tax Appellate Tribunal (hereinafter referred to as Tribunal) on the premise that the order of appellate authority fails to see that the order of assessment stands vitiated on the ground of having been made in violation of principles of natural justice. 2. The petitioner is engaged in manufacture, sales and laying of mosaic tiles. During the relevant assessment years viz., 1991-1992, 1992-1993 and 1993-1994, petitioner was registered under the Tamil Nadu General Sales Tax Act, 1959. Place of business of the petitioner was inspected by Enforcement Wing officials on 15.03.1994. During the course of inspection, records and documents were seized. On the basis of the seized records i.e., D7 records, notices came to be issued by the Enforcement Wing officials proposing to levy tax on the ground of suppression and a best judgment assessment came to be made. Page 2 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008Aggrieved by the same, petitioner preferred original petitions before the Tamil Nadu Taxation Special Tribunal in O.P.Nos.1090, 1091 and 1092 of 1996. Challenge before the Special Tribunal was primarily on the ground that assessment has been made without affording the petitioner adequate opportunity and being a small businessman, he was not able to respond within time and that the entries found in the seized records do not relate to any transaction of sales. The Special Tribunal set aside the impugned orders of assessment while permitting petitioner to submit his objections to the pre-assessment notices and also the proposals for making the best judgment assessment. 3. Pursuant to the above order of the Tamil Nadu Taxation Special Tribunal, petitioner submitted his objections on 12.11.1996 wherein petitioner inter alia submitted that these are work contracts and that seized records do not reveal suppression of any transaction of sales/deemed sales, while requesting that copies of the records be furnished to the petitioner. The orders of assessment came to be passed vide orders dated 13.07.1999 wherein the objections of the petitioner were rejected and the proposal to treat the entries in the D7 records as representing suppression/omission was confirmed. Appeals came to be filed before the Appellate Assistant Commissioner in respect of assessment years 1991-1992, 1992-1993 and 1993-1994 in A.P.Nos.374, Page 3 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008372 and 373 of 1999. It was pointed out by the learned counsel for the petitioner that petition for direction was also filed before the first appellate authority wherein request was made to furnish the petitioner with xerox copies of the seized records at their expense. The first appellate authority passed the order confirming orders of assessment while dropping penalty. The order of the Appellate Assistant Commissioner was carried by way of appeals before the Tribunal. On hearing the petitioner and on examining the records, orders of the first appellate authority came to be confirmed. 4. The short ground on which the common order of the Tribunal is challenged is that the petitioner has been denied opportunity to respond to the allegations/case of suppression set up by the Revenue inasmuch as petitioner was not furnished with copies of D7 records though petitioner was permitted to peruse the D7 records. 5. Learned counsel for petitioner would submit that though the petitioner was permitted to peruse the D7 records, that may not satisfy the principles of natural justice inasmuch as copies of D7 records ought to have been furnished and in this regard, reliance was placed on the judgment in Kwality Granites and Marbles Vs. The Registrar, Tamil Nadu Taxation Special Tribunal and Another reported in (2006) 146 Page 4 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008STC 25. 6. To the contrary, learned Revenue counsel Mr.V.Prashanth Kiran would submit that the submission of the petitioner may not be factually correct inasmuch as from the records, it would be clear and evident that the petitioner was in fact furnished with copies of D7 records and therefore, the grievance of the petitioner is misplaced and contrary to facts. In this regard, he would place reliance upon the following portions of the assessment order:'To a notice issued on 19.3.99 and served on the managing partner on 24.3.99 inviting objections if any against the above proposals and the managing director requested time to file their objections and filed their objections on 11.5.99 as follows:-1.All the entires in D7 slips are only quotations and jottings;2.We are doing job works only. We are not a manufacturer or seller.The D7 slips never proves any completed transactions. So the estimated sales value fixed for all the jottings is only an arbitrary manner. Further all the D7 slips covered various dates of the year. Further addition at 3 times is not warranted.We are undertaking only job works. Therefore purchase of raw materials assessed and sales estimated is highly arbitrary. The rate of surcharge is noted as 15% but upto Page 5 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 20084.9.91 the rate of surcharge was only 10%. Moreover the assessment is proposed to make under section 12, penalty u/s 16(2) is not warranted. Finally requested to drop the proposals of revisions.The objections raised by them have been carefully examined as follows:1.The managing partner of Tvl.Arulmurugan Mosaic tiles appeared and given a written statement on 27.8.97 regarding the slips recovered that the D7 slips recovered are relating to them and the entries made are transactions effected by them.2. for each and every slip the managing partner has given detailed findings in his statement dated 27.8.97 and accepted the transactions mentioned in the slips are sales.In 11 slips only there is no date and such slips were treated for the transactions made during the current year i.e. 93-94 the year in which the shop inspection was conducted.The assessment was completed on a total and taxable turnover of Rs.954,500.00 to the best of judgment already and hence revision of assessment is now made under Section 16 of the Act.The managing partner has stated that the amounts noted in the slips related to cooly given to labourers for making tiles. Though the explanation given is taken into consideration the disposals of mosaic tiles manufactured by giving labour charges as per these slips is not disclosed.'Page 6 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 20087. Learned Revenue counsel would submit that from the above extract, it leaves no room for any doubt that the petitioner was in fact furnished with copies of D7 records and therefore, the request for being furnished with copies of D7 records is an after thought and contrary to facts.8. Having heard both sides, while the petitioner would submit that despite a request for furnishing seized records the same was never furnished by the authorities below. We find from the response of the petitioner extracted supra that petitioner had in fact submitted its explanation to the proposals made on the basis of D7 records i.e., seized records, which the learned counsel for respondents would submit, reveals that petitioner was in fact furnished with D7 records. We find merit in the above submission. 9. While it may be true that normally once a request is made for furnishing of seized records, it is only appropriate that copies of the seized records be furnished to the assessee/petitioner, however, in the present case, as found supra we agree with the learned counsel for respondent that from the material on record it does appear that the petitioner was in fact furnished with the copies of D7 record. In any view even according to the petitioner the D7 records were permitted to be Page 7 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008perused and petitioner has also submitted its response, thus the case of violation of principles of natural justice is devoid of any merit. 10. That apart, we see no reason to interfere with the order of Tribunal for two other reasons viz., (1) whether D7 records were furnished or petitioner was only permitted to peruse is essentially a disputed question of fact, this Court would be loathe in interfering under Article 226 of the Constitution of India when questions of facts are under dispute and (2) Secondly, as submitted by the learned Revenue counsel, petitioner had not stated prior to assessment that mere permission to peruse records, would not be sufficient compliance with principles of natural justice, it is trite that adequacy or inadequacy of opportunity is an aspect which would vary with facts of each case and this Court would not entertain nor examine such aspect in exercise of its discretion under Article 226 of the Constitution of India. 11 In view of the above reasons, we see no reason to interfere with the order of the Tribunal and therefore, these writ petitions stand dismissed. There shall be no order as to costs.[S.M.S., J.] [M.S.Q., J.] 06.10.2025Page 8 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008Index:Yes/NoNeutral Citation:Yes/NommiTo1.The Sales Tax Appellate Tribunal (Additional Bench), City Civil Court Buildings,Chennai – 104.2.The Deputy Commercial Tax Officer, Pattukottai – I.3.The Deputy Commercial Tax Officer(Enforcement) I, Mannargudi.Page 9 of 10 https://www.mhc.tn.gov.in/judis W.P. Nos.19277 to 19279 of 2008S.M.SUBRAMANIAM, J.ANDMOHAMMED SHAFFIQ, J.mmiW.P. Nos.19277 to 19279 of 200806.10.2025Page 10 of 10