Natural justice in tax revision: revisional order set aside where dealer was denied a meaningful opportunity to meet proposed adverse action.

A revisional order under the Andhra Pradesh Value Added Tax Act could not stand where the dealer was not told what further material was needed to test its explanation and was therefore denied an effective hearing. The dealer had explained that the disputed transactions were sales of fresh fish exempt under the First Schedule and had produced invoices and ledgers, but the revisional authority did not seek the specific additional information it considered necessary before adverse action. The order was held vitiated for breach of natural justice, was set aside, and the matter was remitted for fresh consideration after giving the dealer a meaningful opportunity to respond.

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Issues: Whether the revisional order under section 32 of the Andhra Pradesh Value Added Tax Act, 2005 could be sustained when the dealer was not informed of the material considered necessary and was not given an effective opportunity to meet the proposed revision relating to alleged unreported turnover of exempt fish sales.

Analysis: The revisional notice only indicated that sales of raw material had not been brought into the net turnover, while the dealer replied that the transactions were sales of fresh fish exempt under entry 24 of the First Schedule to the Act and produced invoices and ledgers. If the revisional authority considered the explanation and documents insufficient, it was required to seek the further information it considered necessary and to put the dealer on notice of the precise material needed for examination. Since that was not done, the dealer was denied a meaningful opportunity of being heard.

Conclusion: The revisional order was vitiated for breach of natural justice and was set aside. The authority was left free to call for necessary information and pass a fresh order in accordance with law.

Final Conclusion: The writ petition succeeded to the extent that the impugned revisional order was annulled and the matter was remitted for reconsideration after giving the dealer an effective hearing.

Ratio Decidendi: A revisional order cannot be sustained where the assessee is not informed of the specific further material required to test its explanation and is thereby denied an effective opportunity to meet the proposed adverse action.

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