Provisional assessment based on an unsustainable premise was quashed, with consequential coercive orders set aside and reconsideration directed.

The Gujarat High Court text notes that a provisional assessment under section 41B of the Gujarat Sales Tax Act, 1969, together with consequential attachment, cancellation of registration and security-demand orders, could not be sustained where an earlier binding decision required reconsideration in light of the apex Court's principles and the State's recorded stand. It records that genuine transactions would not be hit by section 30AA and its proviso, and therefore the impugned provisional assessment lost its foundation. The provisional assessment and all consequential coercive orders were quashed and the matter was directed to be decided afresh in accordance with law.

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Issues: Whether the provisional assessment made under section 41B of the Gujarat Sales Tax Act, 1969, and the consequential attachment, cancellation of registration, and security-demand orders could be sustained in view of the earlier binding decision and the State's stand that genuine transactions would not be affected by section 30AA and its proviso.

Analysis: The petition was covered by the earlier decision of the same Court, which had required the authorities to re-examine the matter in the light of the principles laid down by the apex Court and the State Government's recorded stand. It was accepted that genuine transactions would not be hit by section 30AA and the proviso thereto. On that basis, the impugned provisional assessment could not stand and the consequential coercive orders based on it also lost their foundation.

Conclusion: The provisional assessment and all consequential orders were quashed and set aside, with directions to take a fresh decision in accordance with law.

Ratio Decidendi: Where the governing legal position and the State's own stand require reassessment of the matter, a provisional assessment founded on the impugned premise and all consequential coercive actions must be annulled and the matter decided afresh in accordance with law.

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