Natural justice in mismatch turnover assessments led to remand for fresh adjudication with partial deposit condition.

Assessment orders concerning mismatch turnover notices were held to need fresh consideration where the taxpayer had not effectively responded and the replies were not fully examined, raising a natural justice concern. The court also noted that part of the demand had already been dropped under the Commissioner's circular on mismatches between purchasing and selling dealers, so the assessments were not finally sustained on merits and were remitted for reconsideration. The matter was sent back to the assessing authority for a fresh order after a proper reply, with the governing circular to be applied, subject to payment of 25% of the disputed tax in cash within 45 days.

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Issues: (i) Whether the impugned assessment orders warranted interference for violation of principles of natural justice and incomplete consideration of the petitioner's reply to the mismatch turnover notices. (ii) Whether the matter should be remitted for fresh assessment with a condition to deposit a part of the disputed tax.

Issue (i): The impugned orders were passed after notices issued on the mismatch turnover issue, but the petitioner had not effectively responded and the assessment was completed without a proper opportunity being fully availed. The order also reflected that part of the demand had already been dropped applying the Commissioner's circular governing mismatch between purchasing and selling dealers under the VAT regime. In these circumstances, the assessment required reconsideration rather than final affirmance on merits.

Conclusion: The assessments were not sustained as finally concluded on merits and required fresh consideration.

Issue (ii): Since the dispute concerned turnover mismatches and the petitioner had not preferred statutory appeals, the Court balanced the need for reconsideration with a condition for partial payment. The matter was therefore sent back to the assessing authority for a fresh decision on merits, with directions to file a proper reply and for the authority to apply the governing circular while passing a fresh order.

Conclusion: The matter was remitted to the respondent for fresh assessment subject to payment of 25% of the disputed tax in cash within 45 days.

Final Conclusion: The writ petitions were disposed of by setting the assessments for reconsideration and directing a fresh order after opportunity to the petitioner, with a conditional partial deposit as a precondition for such reconsideration.

Ratio Decidendi: Where an assessment is made without a proper and effective opportunity and the dispute requires reconsideration under the governing administrative guidance, the matter may be remitted for fresh adjudication with a conditional partial deposit.

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