2021 (12) TMI 520 - HC - GST

Rate of GST - in relation to any function entrusted to a Panchayat under article 243G of the Constitution of India or in relation to any function entrusted to a Municipality under Article 243 W of the Constitution of India - pure services (Cleaning) to the Nagar Parishad - HELD THAT - The notice dated 25.01.2020 (Annexure-5) is quashed with the direction to the assessing officer to issue a fresh notice in the light of the statutory provisions and pass an appropriate order in accordance with law. All proceedings be positively complied with in these matters. Petition allowed.

Summary

Issues involved:
1. Challenge to tax, penalty, and interest calculation orders for the financial year 2019-20.
2. Setting aside ex-parte final orders passed by the Assistant Commissioner under Section 74 of the Goods and Services Tax Act, 2017.
3. Request for relief based on a previous judgment regarding tax exemption for services provided to government authorities.
4. Allegations of non-compliance with statutory provisions and violation of principles of natural justice in issuing tax demands and orders.

Analysis:

Issue 1: Challenge to tax, penalty, and interest calculation orders
The petitioners sought relief against orders issued by the Assistant Commissioner for tax, penalty, and interest calculations for specific months in the financial year 2019-20. The petitioners requested the court to set aside these orders and issue directions for the issuance of specific documents. However, during the proceedings, the petitioners expressed contentment if the Assessing Officer reconsiders their case in light of a previous judgment related to tax exemption for services provided to government entities.

Issue 2: Setting aside ex-parte final orders
The petitioners further prayed for setting aside ex-parte final orders passed by the Assistant Commissioner under Section 74 of the Goods and Services Tax Act, 2017. The orders imposed significant tax, penalty, and interest amounts on the petitioners for specific periods in 2019. The court noted that the minimum statutory period of 30 days required for payment was not provided to the petitioners before the orders were passed. Consequently, the court quashed the notice and the order of assessment, directing the Assessing Officer to issue a fresh notice and ensure compliance with statutory provisions.

Issue 3: Relief based on a previous judgment
The petitioners based their request for relief on a previous judgment that declared the tax rate as nil for services provided to government authorities. They argued that the services they provided were tax-free, and the demands and orders issued against them were in violation of statutory provisions and principles of natural justice. The court acknowledged the petitioners' contentions and ordered for the quashing of relevant notices and demands, with directions for compliance with the law.

Issue 4: Allegations of non-compliance and violation of principles
The petitioners alleged non-compliance with mandatory provisions and violation of natural justice in the issuance of show-cause notices, final orders, and demand notices. The court found merit in these allegations and emphasized the importance of adhering to statutory provisions and principles of natural justice in tax assessment proceedings. Consequently, the court allowed the petition, quashed relevant notices, and directed the authorities to follow due process in future proceedings.

This detailed analysis highlights the various issues addressed in the judgment, including challenges to tax calculations, setting aside of ex-parte orders, reliance on previous judgments for relief, and allegations of non-compliance and violation of principles in tax assessment matters.