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2024 (5) TMI 930 - HC - VAT and Sales TaxValidity of assessment order - disallowance of ITC - petitioner submits that assessment order is a system generated order passed without application of mind - no reasoning given for disallowing the ITC claimed - violation of principles of natural justice - HELD THAT - From perusal of the impugned order, it is evident that it is a computer generated computation. Neither the basic facts with regard to the issuance of notice and non-compliance is mentioned in the order nor the reasons for disallowance. The Hon ble Supreme Court in KRANTI ASSOCIATES PVT. LTD. VERSUS MASOOD AHMED KHAN 2010 (9) TMI 886 - SUPREME COURT has held that every judicial/quasi-judicial order must be supported by reasons to be recorded in writing. The present is a case of violation of principle of natural justice, creation of demand by non application of mind and falls within the exceptions carved out for exercising writ jurisdiction in spite of an alternative remedy. - the assessment order was passed under Section 23 (1) of the Act as a deemed assessment and at the same time, demand was created by disallowing ITC. The impugned order is quashed - Petition allowed.
Issues Involved:
The petition seeks to quash an assessment order under the Rajasthan Value Added Tax Act, 2003, creating a demand of Rs. 27,87,371 based on disallowed Input Tax Credit (ITC) claimed in the returns for the assessment year 2014-2015. Assessment Order Quashing: The petitioner argued that the assessment order lacked reasoning for disallowing the ITC claimed and was passed without proper application of mind, violating the principles of natural justice. It was contended that the order was a system-generated one under Section 23, but no proceedings were initiated under Section 24 of the Act. The Supreme Court's stance on entertaining writ petitions despite alternative remedies was cited, emphasizing exceptions where fundamental rights, natural justice, lack of jurisdiction, or vires of an Act are in question. Reasoning Requirement: The High Court highlighted the necessity for judicial/quasi-judicial orders to be supported by reasons, as per the Supreme Court's decision in M/s Kranti Associates Pvt. Ltd. v. Sh. Masood Ahmed Khan. The importance of recording reasons in decision-making processes to ensure justice, transparency, and accountability was underscored. The Court referenced the case of Mohinder Singh Gill v. The Chief Election Commissioner, emphasizing that the validity of an order must be judged based on the reasons mentioned at the time of the decision. Violation of Natural Justice: The Court found that the assessment order lacked essential details, such as issuance of notice, non-compliance, and reasons for disallowance of ITC, indicating a violation of natural justice. The order was deemed to be a case falling within the exceptions allowing writ jurisdiction despite the availability of alternative remedies. The Court quashed the impugned order, granting liberty to the respondents to proceed against the petitioner in accordance with the law, and allowed the writ petition.
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