Fair consideration in best judgment assessment requires meaningful reply review and opportunity to produce export proof documents.

A best judgment assessment under the KVAT Act was set aside because the assessing authority gave only a brief finding that export proof documents were not produced and did not meaningfully consider the assessee's reply claiming exempt export sales. Fairness required a further opportunity to explain and substantiate the claim where taxability depended on documentary evidence. The matter was remitted for fresh consideration, with directions to afford an opportunity of hearing and to allow production of additional documents before finalising the assessment.

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Issues: Whether the best judgment assessment order passed under Section 25 of the KVAT Act, 2003 was liable to be set aside for want of adequate consideration of the reply and opportunity to produce supporting documents.

Analysis: The assessment order recorded only a brief conclusion that the assessee had not produced the shipping bill and BRC to prove export and receipt of payment. The reply submitted by the petitioner asserting that the transactions were export sales exempt from tax was not meaningfully dealt with. In such circumstances, fairness required that the petitioner be given a further opportunity to substantiate the claim before finalising the assessment, especially when taxability itself was disputed on the basis of documentary proof.

Conclusion: The assessment order was set aside and the matter was remitted to the assessing authority for fresh consideration after affording the petitioner an opportunity of hearing and to produce additional documents.

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