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2024 (5) TMI 930 - HC - VAT and Sales Tax


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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