UTSAV ENTERPRISE Vs. STATE OF GUJARAT

JUDGEMENT

(1.) By this petition under Article 226 of the Constitution of India, the petitioners have challenged the order dated 22.10.2018 made by the Gujarat Value Added Tax Tribunal (hereinafter referred to as the "the Tribunal") in Second Appeal No.1105 of 2018.

(2.) The first petitioner Utsav Enterprise, a proprietorship firm registered under the Gujarat Value Added Tax Act, 2003 (hereinafter referred to as "the GVAT Act") is engaged in the business of trading in chemicals. It is the case of the petitioners that the returns were duly filed and tax as applicable was paid under the GVAT Act. The petitioners purchased goods from registered dealers under the GVAT Act. Input tax credit was claimed by the petitioners on the tax paid on such purchases in accordance with the provisions of the GVAT Act.

(3.) Input tax credit for assessment year 2013-?14 came to be disallowed in the case of the petitioner on the basis of alleged negative cross check reports. It was alleged that the vendors of the petitioners had purchased goods from some vendors whose registration certificates had been retrospectively cancelled and that there were dues in the case of the vendors. Accordingly, the Assessing Officer, vide order dated 28.3.2018, by placing reliance upon section 11(7A) of the GVAT Act disallowed input tax credit in the case of the petitioners for the year 2013-?14. It is the case of the petitioners that the negative cross check reports or assessment orders passed in the case of the petitioners were never provided to the petitioners. The petitioners challenged the assessment order by way of a first appeal which came to be summarily dismissed on the ground of nonpayment of pre-?deposit. The petitioners preferred a second appeal before the Tribunal. The Tribunal, by an order dated 22.10.2018, admitted the appeal and stayed recovery on condition that the petitioners deposit 20% of tax demand within a period of one month.