"REASONS TO BELIEVE"

"REASONS TO BELIEVE"

Reasons to suspect and reasons to believe are two different things. An assessee has the right to know why any action is taken against them and the specific reasons to believe. Communicating these reasons is a fundamental principle of natural justice.

1. EXCELLENT VISION TECHNICAL ACADEMY PVT. LTD. - Allahabad High Court

(2024) 19 Centax 458

GST: Where search was carried out on premises of the assessee under section 67, and no reasons to believe were noted in INS-01, entire proceedings were to be quashed.

2. Rakesh Kumar Saraogi - Chhattisgarh High Court

ILR 2018 CHHATTISGARH (SN) 477

Income Tax: Reasons to believe not supplied to assessee despite making request -Application seeking reasons to believe treated as objections to reasons to believe -?

Rebuttal order passed without supplying reasons to believe - Rejection of application, not proper.

3. M/s Agarwal Iron Industries - Supreme Court

2014 AIR SCW 6844

Income Tax: Search and seizure - Conduct of - 'Reason to believe' - Can be recorded on file - Court can scrutinize the file - And find out whether an authority has appropriately recorded reasons forming the opinion that there are reasons to believe in conducting search and seizure.

Author's Comment:

This means the reasons to believe have to be recorded, and the Court can scrutinize and decide whether there were reasons to believe or not.

4. Vikas Jain - Allahabad High Court

(2024) 83 GSTL 75

Where assessee was arrested without assigning any reasons to believe or any satisfaction to justified arrest nor any notice for recovery of GST had been issued against assessee or penalty or taxes had been ascertained, bail was to be granted

5.RAJNANDINI METAL LTD. - Punjab & Haryana HC

(2022) 64GSTL 301

Order blocking electronic credit ledger to bar use of input tax credit is not sustainable if it does not record reason to believe that assessee availed ITC fraudulently and merely states that investigation was going on

6. GOLDEN COTTON INDUSTRIES - Gujarat High Court

(2019) 29 GSTL 587

“Reasons to believe” - “Belief” is mental operation of accepting fact as true - Without any fact, no belief can be formed.

Though it is not necessary for Proper Officer to state reasons for his belief, but if it is challenged, he must disclose materials upon which his belief was formed - Section 67 of CGST.

I hope you will find this useful.

Thanks

Raja Abhishek

NIRC Candidate for 2024

9810638155