Varun Auto vs. The Assistant Commissioner

Facts

The petitioner, Varun Auto, through its Authorized Person, filed a writ petition challenging an order dated 26.02.2025 passed by the Assistant Commissioner, Sales Tax Department. The impugned order pertains to the Assessment Year 2020-2021. The petitioner contended that the order was passed without considering their past records, which would have shown no discrepancy and that any excess input tax credit had already been rectified. They further argued that the respondent failed to consider the payment of late fees for corresponding GSTR entries, indicating a mechanical application of mind. The respondent, represented by the Government Advocate, asserted that the order was passed after due consideration of relevant facts and in accordance with law, with procedural requirements being met.

Held

The Court held that the impugned order suffers from non-application of mind and mechanical consideration of facts. The reasoning was based on the submissions of both parties, particularly the petitioner's assertion that their past records and rectification of excess input tax credit, along with payment of late fees, were not duly considered. The Court found merit in the petitioner's claim that the order appeared to be passed without a thorough examination of the case specifics. Consequently, the Court decided to remand the matter back to the respondent for a fresh consideration. The respondent was directed to pass fresh orders on merits and in accordance with law, after affording the petitioner a due opportunity of hearing, within a period of four months from the date of receiving a copy of the order. The writ petition was allowed accordingly.

Key Issues

1. Whether the impugned order dated 26.02.2025, passed by the respondent for the Assessment Year 2020-2021, suffers from non-application of mind and mechanical consideration of facts, thereby violating principles of natural justice? Petitioner's arguments: The petitioner argued that the respondent failed to consider their past records, which would have demonstrated the absence of discrepancies and the rectification of any excess input tax credit. They also contended that the respondent overlooked the fact that the petitioner had paid the pending late fees for the relevant GSTR entries. These omissions, according to the petitioner, indicate a mechanical passing of the order without due application of mind to the specific facts and circumstances of the case. Respondent's arguments: The respondent contended that the impugned order was passed after due consideration of all relevant facts and in compliance with applicable legal provisions. They asserted that the petitioner's submissions regarding past records and payments were examined, and the order correctly reflects the application of law. The respondent also maintained that procedural requirements were fulfilled and the findings were based on available evidence.