Best judgment assessment under VAT law must be reconsidered where rectification is pending and recovery is stayed meanwhile.

Best judgment assessment for non-production of audited statements was questioned where earlier Division Bench authority had held that Section 25(1) of the Kerala Value Added Tax Act, 2003 does not permit such assessment merely for non-filing of Form Nos. 13 and 13(A). In that setting, the proper course was to require consideration of the pending rectification application by a reasoned order, and recovery proceedings under the assessment order were directed to remain in abeyance until such consideration.

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Issues: Whether the assessee was entitled to have the rectification application considered in relation to the best judgment assessment and to have recovery proceedings kept in abeyance pending such consideration.

Analysis: The assessment was made on a best judgment basis for non-production of the audited statement with the returns. The Court noted the limited nature of the relief sought and the existence of an earlier Division Bench view that Section 25(1) of the Kerala Value Added Tax Act, 2003 does not permit best judgment assessment merely on the ground that audited statements in Form No.13 and 13(A) were not filed. In that background, the proper course was to direct consideration of the pending rectification application by a reasoned order.

Conclusion: The rectification application was directed to be considered, and recovery proceedings pursuant to the assessment order were ordered to be kept in abeyance in the meantime.

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