Affidavit Of Cost Accountant In Personal Hearing Cannot Be Ignored When Facts Are Admitted By State Tax Officer: Kerala High Court

The Kerala High Court has held that an affidavit by professionals, such as a cost accountant, given during a personal hearing, cannot be ignored, especially when a state tax officer admits facts referred therein. Justice Ziyad Rahman A.A. stated that when a professional swears an affidavit before this Court, highlighting the matters that transpired during the course of the hearing, the same cannot be simply ignored, particularly in a situation where, to some extent, there is an admission forthcoming from the part of the State Tax Officer with regard to the matters referred to in the said affidavit. Therefore, the assessee can be granted one more opportunity to be heard. The dispute was in respect of the assessment year 2017-2018, and the assessee/petitioner was earlier served with a show cause notice. Even though the assessee submitted a written explanation to the said show cause notice, an order was passed wherein the objections raised by the assessee were rejected, and the order rejected the input tax credit claimed by the assessee. When the authorised representative of the assessee appeared before the State Tax Officer for a hearing, he was directed to appear before another officer, and thereafter the order was passed by the State Tax Officer, considering that the matter had been heard. The assessee argued that he was not afforded a proper opportunity, and there was a violation of principles of natural justice. To support this, the assessee produced an affidavit by the assessee's authorised representative, a Cost Accountant, who asserted that he appeared before the State Tax Officer for a personal hearing, but he was directed to appear before the personal staff/clerk. In the affidavit, it was stated that a proper hearing was not held, and instead, a subordinate officer in the office of the State Tax Officer simply collected the files and obtained the details of the client. The bench agreed with the assessee that the reasons mentioned in the show cause notice for the invocation of Section 74 of the CGST Act are very vague. The Court stated that even though in Clause (II) of the show cause notice, the brief facts of the case are mentioned and the details of the transaction in respect of which the discrepancy was alleged were referred to, the further details in respect of the same are not revealed. The bench noted that in order the details of the allegations are specifically highlighted. The bench opined that the contention of the assessee, that had these details been furnished in the show cause notice itself, they could have contested the matter more effectively by producing the documents to substantiate their contentions, cannot be ignored. In view of the above, the bench granted a hearing opportunity to the assessee. Case Title: M/s Ridha Polymers v. State of Kerala Case Number: WP(C) NO. 17324 OF 2025Citation: 2025 LiveLaw (Ker) 757 Counsel for Petitioner/Assessee: P.N. Damodaran Namboodiri Counsel for Respondent/Department: Preetha S. Nair Click Here To Read/Download The Order

Affidavit Of Cost Accountant In Personal Hearing Cannot Be Ignored When Facts Are Admitted By State Tax Officer: Kerala High Court

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