Natural justice in tax assessments requires supply of mismatch details and a meaningful chance to explain documentary deficiencies.

An assessment based on mismatch entries cannot be sustained where the assessee is denied seller invoice and TIN particulars needed for reconciliation, because withholding those details deprives the assessee of a meaningful opportunity and violates natural justice. A rejection of zero-rated sales is also procedurally unsustainable when the assessing authority does not specifically call for the relevant records, although the assessee had produced some documents and sought further intimation if required. The assessment must be made on the basis of materials independently considered by the authority, after supplying the necessary seller details, calling for the requisite documents, and granting a personal hearing before redetermination in accordance with law.

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Issues: (i) Whether the assessment orders could be sustained when the assessee was denied the seller's invoice/TIN particulars needed for reconciliation of mismatch entries; (ii) whether the claim of zero-rated sales could be rejected for want of documents without specifically calling for the relevant records and affording an effective opportunity.

Issue (i): Whether the assessment orders could be sustained when the assessee was denied the seller's invoice/TIN particulars needed for reconciliation of mismatch entries.

Analysis: The mismatch was worked out by comparing the purchasing dealer's Annexure-I with the selling dealer's Annexure-II, but the vital seller particulars were left blank and the assessee's request for invoice and TIN details to enable reconciliation was not honoured. A circular of the commercial tax department required such details to be furnished, and the assessing authority was bound to act on them. The absence of those particulars deprived the assessee of a meaningful opportunity to explain the mismatch and amounted to a violation of natural justice.

Conclusion: The assessment on the mismatch issue could not be sustained against the assessee.

Issue (ii): Whether the claim of zero-rated sales could be rejected for want of documents without specifically calling for the relevant records and affording an effective opportunity.

Analysis: The assessee had produced certain records and had sought intimation if any further documents were required. The assessing authority did not specifically call for the documents now relied upon for rejection, and also proceeded on the basis that non-production before the enforcement wing was sufficient. The assessing authority was required to independently consider the materials before it, particularly when the assessee was deemed to have been assessed under the Act and the documents insisted upon were not shown to be statutorily required in the monthly returns. The rejection was therefore procedurally unsustainable.

Conclusion: The rejection of the zero-rated sales claim was not sustainable against the assessee.

Final Conclusion: The assessment orders were set aside and the matters were remitted for fresh consideration after supplying the necessary seller details, calling for the requisite documents, and granting a personal hearing before redetermination in accordance with law.

Ratio Decidendi: An assessment based on mismatch or documentary deficiency cannot be sustained unless the assessee is supplied the material necessary for reconciliation and is given a meaningful opportunity to produce and explain the relevant documents before the authority independently applies its mind.

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