Gujarat High Court
Vithlani Exports vs State Of Gujarat on 16 October, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 9536 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 9656 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
=================================================
Approved for Reporting Yes
No
✔
================================================== VITHLANI EXPORTS Versus STATE OF GUJARAT & ORS.
================================================== Appearance:
MR. APURVA N MEHTA(7202) for the Petitioner(s) No. 1 MS SHRUNJAL SHAH ASSISTANT GOVERNMENT PLEADER for the Respondent(s) No. 1,2,3 NOTICE SERVED for the Respondent(s) No. 4 ================================================== CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA and HONOURABLE MR. JUSTICE PRANAV TRIVEDI Date : 16/10/2025 ORAL COMMON JUDGMENT (PER : HONOURABLE MR. JUSTICE PRANAV TRIVEDI)
1. Heard learned advocate Mr. Apurva Mehta for the petitioner and learned Assistant Government Pleader Ms. Shrunjal T. Shah for the respondents.
2. Rule returnable forthwith. Learned Assistant Government Pleader Ms. Shrunjal Shah waives service of notice of Rule for Page 1 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined the respondents.
3. Having regard to the controversy involved which is in narrow compass, this matter is taken up for hearing with the consent of learned advocates for both the parties.
4. As the issue is common in both the petitions, Special Civil Application No. 9536 of 2025 is taken a lead matter and facts are recorded from the said petition.
5. By this petition under Article 226 of the Constitution of India, the petitioner has prayed to quash and set aside the impugned order dated 29.01.2025 passed by the learned Gujarat Value Added Tax Tribunal at Ahmedabad (For Short "the Tribunal") passed in Misc. Application No. 38 of 2024 and further to restore the Second Appeal No. 440 of 2018.
6. The brief facts leading to filing of the writ petition is that the petitioner is a proprietary concern and is carrying on the business of trading in agricultural products. The petitioner concern is duly registered as a dealer under the Value Added Tax Act (hereinafter referred to as "the VAT Act" as well as Page 2 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined under the Central State Tax Act (For Short "CST Act"). 6.1. It is the case of the petitioner that the petitioner has filed all the periodic as well as annual self-assessment returns for the period under consideration. It is the case of the petitioner that the respondent no. 2 (hereinafter referred to as "the respondent") passed the Assessment Order for the Financial year 2009-10 on 31.03.2014 under Section 34(2) of the VAT Act read with Section 9(2) of the CST Act raising additional dues of Rs.16,92,165/- along with interest amount of Rs.6,18,459 and penalty of Rs.2,14,741/-. The said dues were raised due to disallowance of the Input Tax Credit in the Assessment Order passed under the VAT Act.
6.2. Being aggrieved by the Assessment Order passed by the respondents, the petitioner challenged the order dated 31.03.20214 before the learned appellate authority under Section 73(1) of the VAT Act read with Section 9(2) of the CST Act.
6.3. It is the case of the petitioner that the entire amount of tax Page 3 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined of Rs.8,58,964/ - towards pre-deposit was paid on 21.05.2015, which has resulted into appeal being admitted for hearing on 30.06.2014. Subsequently on 21.03.2018, the appellate authority rejected the appeal preferred by the petitioner and confirmed the Assessment Order dated 31.03.2014 passed by the respondent.
6.4. Being dissatisfied by the order passed by the appellate authority, the petitioner preferred Second Appeal under Section 73 of the VAT Act read with Section 9(2) of the CST Act before the Tribunal, which came to be numbered as Second Appeal No. 440 of 2018. In the memo, the petitioner has raised various grounds of appeal before the Tribunal viz. Non-service of mandatory statutory notice in Form 6B, levy of penalty under Section 34(1) of the VAT Act read with Section 9(2) of the CST Act etc. The Tribunal vide order dated 20.09.2024 while partly allowing the Second Appeal had allowed the Input Tax Credit of Rs.4,973/- and confirmed the disallowance of remaining Input Tax Credit of Rs.11,26,733/-.
6.5. Being aggrieved by the non-consideration of the grounds Page 4 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined raised by the petitioner in the Second Appeal i.e. non-service of mandatory statutory notice in Form 6B, levy of penalty under Section 34(12) of the VAT Act read with Section 9(2) of the CST Act, the petitioner preferred rectification application being Misc. Application No. 38/2024 before the Tribunal. The Tribunal vide judgment and order dated 29.01.2025 rejected the rectification application on the ground that Second Appeal was decided on merits after hearing the parties and therefore, the judgment and order passed by the Tribunal was appealable order under Section 78 of the VAT Act.
6.6. Being dissatisfied by the order dated 29.01.2025 passed by the Tribunal in Misc. Application No. 38 of 2024 as well as the order dated 20.09.2024 passed by the Tribunal are impugned in the present petition.
7. Learned advocate Mr. Apurva Mehta for the petitioner submitted that the order passed by the Tribunal is arbitrary and contrary to the law laid down by this Court inasmuch as the Tribunal has failed to deal with the additional grounds which are raised by the petitioner in the Second Appeal under the Page 5 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined provisions of the CST Act viz non-service of mandatory statutory notice in Form 6B, levy of penalty under Section 34(1) of the VAT Act read with Section 9(2) of the CST Act. 7.1. It is further submitted that the Tribunal has not considered the relevant grounds of appeal and this mistake of fact is apparent from the record and the same was being capable of being rectified under the provisions of Sections 79(1) and 79(2) of the VAT Act read with Section 9(2) of the CST Act. In wake of such submissions, learned advocate for the petitioner has requested to remand the matter back to the Tribunal for consideration of the issues which are not dealt with by the Tribunal.
8. Per contra, learned Assistant Government Pleader Ms. Shrunjal Shah for the respondents was not in a position to controvert the submission made by the petitioner and categorically accepted that the grounds raised by the petitioner in the Second Appeal are not dealt with by the Tribunal and as such, the Court may pass appropriate order.
9. Having heard the learned advocates for the respective Page 6 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined parties and having perused the material on record, the short controversy in question is with regard to the non dealing of the issues raised by the petitioner in the Second Appeal by the Tribunal. It is not in dispute that specific ground of non-service of mandatory statutory notice has been raised by the petitioner and the same was part of the Misc. Application. The question of levy of penalty under Section 34(12) of the VAT Act read with Section 9(2) of the CST Act were also raised by the petitioner in Second Appeal as well as Misc. Application, which reads as under :-
"(3) The above contention was also raised at the time of final hearing of the case on 19.06.2024. We have made written submission at Para (10) (11) and (12) regarding statutory notice and non providing 15 days time and same was not served tot he dealer. The extract copy of the Para (10) (11) and (12) out of the submission dated 19.06.2024 is attached here with for ready reference. The submission is very clear on which no decision whatsoever adjudicated by the Hon'ble Tribunal.
(4) The appellant has also raised the ground against the levy of the penalty under Section 34(7) and 34(12) of the Act. In the course of hearing of Second Appeal the written submission dated 19.06.2024. The argument at para (13) was raised. The copy o the said argument submitted before the Hon'ble Tribunal is enclosed herewith on which adjudication was given in Second Appeal order dated 20.09.2024."
10. Having gone through the judgment and order passed by the Tribunal in Misc. Application, it is not in dispute that the Page 7 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined grounds raised by the petitioner in Second Appeal are not considered by the Tribunal. It is a fundamental proposition of law that the other side should be heard and all the issues should be considered before any order is passed. The maxim of Audi Alteram Partem is broad enough to include the rule against bias since a fair hearing is must for it to be unbiased hearing. In the instant case, the fact is not in dispute that the grounds raised by the petitioner were not considered before passing the impugned order.
11. In view of the same, the impugned judgment and order dated 2901.2025 passed by the Tribunal in Misc. Application No. 37 of 2024 is not tenable and the same is required to be quashed and set-aside.
12. Considering the facts of the case, the petition succeeds and is accordingly allowed. The impugned judgment and order dated 2901.2025 passed by the Tribunal in Misc. Application No. 37 of 2024 is quashed and set aside and the Second Appeal no. 439 of 2018 is restored to its file. The matter is remanded to the respondent to consider all the grounds raised by the Page 8 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025 NEUTRAL CITATION C/SCA/9536/2025 JUDGMENT DATED: 16/10/2025 undefined petitioner and pass a fresh order after following due procedure of law.
13. Such exercise shall be completed within twelve (12) weeks from the date of receipt of copy of this order.
14. Rule is made absolute to the aforesaid extent with no order as to costs.
(BHARGAV D. KARIA, J) (PRANAV TRIVEDI,J) phalguni Page 9 of 9 Uploaded by PHALGUNI PATEL(HC00175) on Thu Oct 16 2025 Downloaded on : Fri Oct 17 03:33:46 IST 2025