Court sets aside assessment order under Kerala Value Added Tax Act, 2003, citing violation of natural justice.

The court set aside the assessment order challenged under Section 25(1) of the Kerala Value Added Tax Act, 2003, due to a violation of natural justice principles. The assessing authority failed to independently verify seized documents, solely relying on penalty proceedings. The petitioner's right to explain discrepancies through proper verification was upheld, granting an opportunity to reexamine the matter with seized records alongside account books to ensure procedural compliance and fairness in addressing alleged turnover suppression.

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Issues:
Challenge to assessment order under Section 25(1) of Kerala Value Added Tax Act, 2003 on grounds of violation of natural justice.

Analysis:
The petitioner challenges the assessment order, asserting it was passed in violation of natural justice principles as verification of seized records was not allowed. The petitioner argues that penalty and assessment proceedings are distinct, and reliance solely on penalty proceedings for assessment is improper. Citing relevant case law, the petitioner emphasizes the need for independent verification of seized documents to explain any alleged turnover suppression.

The Government Pleader contends that the petitioner's accounts were verified, revealing turnover suppression, thus negating the necessity for further verification. However, the petitioner insists on the importance of examining seized records alongside account books to clarify any discrepancies.

Upon review, it becomes evident that the assessing authority did not address the petitioner's request for verifying seized documents, instead relying on the finality of the penalty order. The court acknowledges the importance of separate consideration for penalty and turnover assessment proceedings, emphasizing the petitioner's right to explain alleged discrepancies through proper verification.

Consequently, the court sets aside the assessment order, directing the assessing authority to reconsider the matter. The petitioner is granted an opportunity to verify seized records alongside account books, ensuring compliance with legal procedures. The judgment emphasizes upholding principles of natural justice by providing the petitioner with a fair chance to address the alleged turnover suppression effectively.

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