Input tax credit disallowance upheld where cross-examination was offered, goods movement was unproven, and writ interference was unwarranted.

Input tax credit disallowance was upheld where the assessee failed to establish movement of goods and relied on toll records not produced from its own possession. The Court found that cross-examination had been afforded after remand, including re-examination of one witness, and rejected the complaint of further denial because the petitioner had declined to participate in the opportunity given. The impugned order was held to have considered the petitioner's stand and was not shown to be perverse or vitiated by jurisdictional error. Writ interference was declined, particularly as an appellate remedy remained available, and the adjudication order was sustained.

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Issues: Whether the adjudication order disallowing input tax credit was liable to be set aside on the ground of denial of cross-examination, non-consideration of toll records, or jurisdictional error.

Analysis: The petitioner had been supplied the relevant material pursuant to the earlier remand, had been afforded cross-examination of the two witnesses for whom relief had been granted, and had thereafter declined to participate in the re-examination of one of them. The subsequent grievance that no further opportunity was given to cross-examine other persons was not accepted. The Court also held that the burden to establish movement of goods and the supporting toll records lay on the petitioner, and that such burden could not be shifted to the authorities when the petitioner had not produced the material in its possession. The impugned order was found to have considered the petitioner's stand and was not shown to be perverse or vitiated by jurisdictional error. Writ interference was also declined in view of the availability of the appellate remedy.

Conclusion: The challenge failed; the adjudication order was upheld and no case was made out for interference in writ jurisdiction.

Ratio Decidendi: A party challenging tax adjudication on grounds of fake transactions must establish the factual basis of its claim and cannot complain of denial of natural justice where it declines the opportunity of cross-examination that was in fact afforded.

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