Writ petition dismissed; appeal remedy under Section 107 available for rectification rejection order.

Rectification Rejection: Assessee Directed to Appellate Authority for Full Scrutiny of Records

Issue: Whether a rectification rejection order, primarily based on the assessee’s alleged failure to produce E-way bills and other documents, should be set aside on the ground that it was passed without proper scrutiny of records and in violation of natural justice principles, or if the assessee should be directed to the appellate authority.

Facts:

• The assessee challenged a rectification rejection order passed by the department for the period 2019-20.
• The department’s primary reason for rejection was the assessee’s failure to produce E-way bills and other documents.
• The assessee contended that this finding was reached without proper scrutiny of the records they had submitted during the proceedings, thereby violating principles of natural justice.
• The Department, conversely, submitted that the assessee had not fully uploaded the requested documents for scrutiny.

Decision: The writ petition was disposed of with liberty granted to the assessee to approach the appellate authority. The assessee was permitted to raise all grounds raised in the writ petition before the appellate authority.

Key Takeaways:

• Exhaustion of Alternate Remedy: When an effective alternate remedy (appeal under Section 107) is available, especially when there are factual disputes regarding the submission and scrutiny of documents, courts often direct the petitioner to exhaust that remedy.
• Appellate Authority’s Role in Factual Scrutiny: The appellate authority is better equipped to conduct a thorough scrutiny of records and documents, which is essential in a case where the dispute revolves around whether all necessary documents were submitted and properly considered.
• Preservation of Grounds: The court ensured that the assessee would not be prejudiced by being directed to the appellate authority, explicitly stating that all grounds raised in the writ petition could be agitated in the appeal.
• Natural Justice (Substantial Compliance): While the assessee alleged violation of natural justice, the Department’s counter-contention about incomplete submission of documents suggests a factual dispute that the appellate authority can more appropriately resolve after examining the records.