Revisional jurisdiction limited to the assessment record; retrospective seller cancellation alone cannot defeat input tax credit.

Revisional power under the Gujarat Value Added Tax Act was confined to the assessment record, so revision based on material outside that record was without jurisdiction and invalid. Input tax credit could not be denied merely because the selling dealer's registration was retrospectively cancelled; in the absence of publication of the cancellation and without recorded findings that the purchases were bogus or non-genuine, the disallowance could not stand. The assessee's entitlement to input tax credit was upheld, and the additional tax and interest confirmed in revision were set aside.

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Issues: (i) Whether revisional proceedings under the Gujarat Value Added Tax Act, 2003 could be initiated on the basis of material not forming part of the assessment record. (ii) Whether input tax credit could be disallowed on purchases made from a dealer whose registration was cancelled retrospectively, in the absence of publication of such cancellation and without recorded findings that the transactions were bogus or non-genuine.

Issue (i): Whether revisional proceedings under the Gujarat Value Added Tax Act, 2003 could be initiated on the basis of material not forming part of the assessment record.

Analysis: The revisional power is confined to examination of the record of the subordinate authority's order. Fresh enquiry on the basis of material outside that record cannot be the foundation of revision. Here, the cancellation order of the selling dealer did not form part of the assessment record when the original assessment was made, yet the revision was initiated on that external material. Such initiation exceeded the statutory limits of revision.

Conclusion: The revisional proceedings were without jurisdiction and invalid.

Issue (ii): Whether input tax credit could be disallowed on purchases made from a dealer whose registration was cancelled retrospectively, in the absence of publication of such cancellation and without recorded findings that the transactions were bogus or non-genuine.

Analysis: Input tax credit under the Act is ordinarily denied only after the dealer's name is published following cancellation or suspension as contemplated by the Act. Retrospective cancellation by itself does not defeat the purchasing dealer's credit. Denial is permissible only if the Department establishes that the purchases were fictitious, bogus, or otherwise non-genuine. In this case, the assessment record did not contain such findings, and the petitioner's credit had originally been allowed after verification. The contrary factual findings were based on material outside the assessment record and could not sustain the disallowance.

Conclusion: The petitioner was entitled to input tax credit and the disallowance of tax and interest could not be sustained.

Final Conclusion: The impugned revision and the Tribunal's confirmation of the additional tax liability and interest were set aside, and the assessee's entitlement to input tax credit was upheld.

Ratio Decidendi: Revisional jurisdiction under the GVAT Act is confined to the assessment record, and input tax credit cannot be denied solely because a seller's registration is retrospectively cancelled unless the statute's publication requirement is met or the Department proves that the underlying purchases were not genuine.

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