2015 (9) TMI 98 - HC - VAT and Sales Tax

Levy of Tax Absence of Sufficient reasons Vide impugned order petitioner was asked to pay tax under provisions of Gujarat Value Added Tax Act, 2003 wherein it was held that registration of those sellers from whom petitioner had purchased some goods had been cancelled and therefore, petitioner was liable to pay tax Petitioner seeking quashing of assessment order passed by Respondent and direction to grant input tax credit Held that - AO has not dealt properly with case and ought to have discussed and appreciated material produced by petitioner on record In absence of sufficient reasons assigned by Assessing Officer, order becomes vulnerable and therefore, requires to be quashed and set aside Therefore impugned order hereby quashed and set aside However, matter remanded to AO to reconsider documentary evidence and pass order in accordance with law Decided in favour of Assesse.

Summary

Issues:
Challenge to assessment order under VAT Act, 2003, demand for input tax credit, restraint on recovery pending petition disposal, failure to follow binding decisions, grant of further relief.

Analysis:
The petitioner sought a writ to quash an assessment order under the VAT Act, 2003, demanding input tax credit and restraining recovery pending disposal. The petitioner also requested direction for input tax credit adjustment under the CST Act, citing non-compliance with previous court decisions. The petitioner argued that the order demanding tax payment due to canceled seller registrations lacked examination of evidence proving genuine purchases. The petitioner contended that purchases were made from registered sellers, making them a genuine purchaser not liable for tax due to seller registration cancellations. The respondent, opposing the petition, highlighted the availability of a statutory appeal for dispute resolution at the appellate stage. After hearing both parties, the court found the Assessing Officer's failure to properly address the case, lacking discussion on evidence, and not providing sufficient reasons for the decision. Consequently, the court quashed the impugned order but remanded the matter to the Assessing Officer for fresh consideration. The Assessing Officer was directed to reevaluate the case, consider documentary evidence and judgments presented by the petitioner, and issue a new order complying with the law.

This judgment reflects the court's intervention due to procedural lapses by the Assessing Officer, highlighting the importance of proper examination of evidence and justification in tax assessment orders. The court's decision to remand the matter for fresh consideration emphasizes the significance of a fair and thorough evaluation process in tax disputes. The petitioner's plea for relief and adherence to legal precedents showcases the need for consistency and compliance with established court decisions in tax matters. The court's balanced approach, quashing the order but allowing for reassessment, demonstrates a commitment to upholding justice while ensuring proper legal procedures are followed in tax assessments.