Natural justice in tax adjudication: non-supply of relied-upon material and denial of hearing led to remand for fresh consideration.

Assessment and rectification orders were set aside for breach of natural justice because the relied-upon investigation material and railway records were not supplied to the taxpayer despite request, and the rectification application was rejected without a personal hearing. The court noted that Section 24(1) of the Maharashtra Value Added Tax Act, 2002 requires a reasonable opportunity of being heard before rejecting rectification on the ground that no mistake apparent on record exists. As the orders were cryptic and unsupported by disclosed reasons, the defects could not be cured by affidavit. The matter was remanded for fresh adjudication by another officer after supply of the material and a personal hearing.

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Issues: Whether the assessment and rectification orders were liable to be set aside for breach of natural justice, including non-supply of relied-upon documents and denial of personal hearing, and whether the matter should be remanded for de novo consideration.

Analysis: The assessment was founded on an investigation report and material from railway authorities, but the documents relied upon were not supplied to the petitioner despite request. The rectification application was also rejected without granting a personal hearing, although Section 24(1) of the Maharashtra Value Added Tax Act, 2002 requires a reasonable opportunity of being heard before rejection on the ground that there is no mistake apparent on record. The orders were described as cryptic and unsupported by any disclosed justification, and the Court held that such defects amounted to a clear failure to observe the rule of law and principles of natural justice. The Court therefore declined to permit the defects to be cured by affidavit and directed a fresh adjudication by another officer.

Conclusion: The impugned orders were set aside and the matter was remanded for fresh consideration after supplying the relied-upon material and granting a personal hearing.

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