Natural justice in sales tax assessment requires disclosure of adverse dealer material and a fair chance to rebut it.

Deduction on sales to registered dealers under the Delhi Sales Tax Act is available only when the prescribed conditions in Rules 7 and 8, including declaration forms, are satisfied. If the assessing authority proposes to disallow the claim on adverse material received from purchasing dealers, the assessee must be given a fair chance to meet that material. Natural justice requires disclosure of the adverse material and, where relevant and properly requested, summoning of the witnesses for verification or cross-examination. On the stated facts, the request to summon the purchasing dealers should have been allowed, and the assessment had to be reconsidered after giving the assessee proper opportunity.

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Issues: Whether the assessee was denied a reasonable opportunity when the assessing authority relied on discrepant material from purchasing dealers without summoning them or allowing reconciliation, and whether the assessment had therefore to be remitted for fresh consideration.

Analysis: Deduction on sales to registered dealers under section 4(2)(a)(v) of the Delhi Sales Tax Act, 1975 is available only on compliance with the prescribed conditions in Rules 7 and 8 of the Delhi Sales Tax Rules, 1975, including production of declaration forms. Where the assessing authority seeks to disallow the claim on the basis of adverse material obtained from purchasing dealers, the assessee must be given a fair opportunity to meet that material. The principles of natural justice require disclosure of adverse material and, where demanded and relevant, the production of witnesses for verification or cross-examination. On the facts, the request to summon the purchasing dealers ought to have been entertained.

Conclusion: The assessee was denied due and proper opportunity, and the matter was required to be remanded to the assessing officer for fresh assessment after summoning the concerned purchasing dealers.

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