Input tax credit on capital goods depends on proof, and failure to object may defeat a natural justice challenge.

Input tax credit on capital goods under the Tamil Nadu Value Added Tax Act depends on proof that the goods satisfy the statutory definition of capital goods and the relevant rules. Where the assessee does not file objections to the show-cause notice or avail the personal hearing, the dispute remains factual and unproven before the assessing authority, so a natural justice challenge may fail. The material also notes that a further opportunity may still be granted on a conditional basis, allowing the assessee to place supporting documents before the authority for fresh consideration.

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Issues: Whether the assessment orders disallowing input tax credit on capital goods required interference, and whether the petitioner was entitled to a further opportunity to establish eligibility for such credit.

Analysis: The claim to input tax credit on capital goods depended on proof that the goods fell within the statutory definition of capital goods under Section 2(11) of the Tamil Nadu Value Added Tax Act, 2006, read with the relevant rules. The petitioner had not filed objections to the show cause notice or availed the personal hearing, and the dispute therefore remained a factual one that had not been established before the Assessing Officer. In these circumstances, the Court found no violation of natural justice warranting quashing of the assessment orders. At the same time, considering the request for one further opportunity, the Court granted a conditional chance to place the materials before the assessing authority.

Conclusion: The assessment orders were not set aside, but the petitioner was permitted to treat them as show cause notices and to seek fresh consideration of the disputed head on payment of the stipulated amount within the time allowed.

Ratio Decidendi: Where eligibility for input tax credit turns on unresolved factual proof and the assessee has failed to avail the statutory opportunity to object, the Court may decline to quash the assessment and instead grant a conditional opportunity for fresh adjudication.

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