2024 (2) TMI 1008 - HC - GST

Validity of assessment order - opportunity not provided to petitioner to contest the tax demand - violation of principles of natural justice - HELD THAT - The amount communicated in the intimation is much lower than the amount in respect of which the petitioner was called upon to show cause. Similarly, the tax demand under the impugned assessment order is much higher than the amount in respect of which the petitioner was called upon to show cause. The petitioner has also place on record the request for adjournment. As a result of the denial of such request, it is clear that the impugned order came to be issued without considering the submissions of the petitioner. In the overall facts and circumstances, the impugned assessment order calls for interference. The impugned order dated 09.10.2023 is quashed and the matter is remanded for re-consideration. The petitioner is permitted to file a reply to the show cause notice within a maximum period of fifteen days from the date of receipt of a copy of this order.

Summary

Issues involved: Assessment order under GST laws, discrepancy in tax demand, denial of adjournment requests, interference with assessment order.

The petitioner, engaged in technology-enabled staffing and outsourcing services, challenged an assessment order dated 09.10.2023 under GST laws. The petitioner received notices in Form GST ASMT-10, GST DRC-01A, and GST DRC-01 regarding tax issues. Despite requesting adjournments due to tax team revamping, the impugned assessment order was issued, leading to the filing of the writ petition.

The petitioner's counsel argued that the tax demand in the assessment order exceeded the amounts specified in earlier notices, contravening Section 75(7) of the Tamil Nadu Goods and Services Tax Act, 2017. The increased tax demand was attributed to the petitioner remitting higher taxes than the taxable supply indicated in the return. The counsel sought to quash the assessment order to allow the petitioner to contest the tax demand.

The respondent's counsel, the Additional Government Pleader, suggested that the petitioner should appeal the assessment order and potentially remit 10% of the disputed tax demand as a precondition for reconsideration.

Upon examination of the records, it was evident that the tax amounts communicated in the notices were significantly different from the final tax demand in the assessment order. The denial of adjournment requests indicated that the impugned order was issued without considering the petitioner's submissions. Consequently, the court found grounds to interfere with the assessment order.

The court quashed the order dated 09.10.2023 and remanded the matter for reconsideration. The petitioner was granted fifteen days to reply to the show cause notice, followed by a directive for the assessing officer to issue a fresh assessment order within two months of receiving the reply, after providing a reasonable opportunity for the petitioner to be heard.

The writ petition was disposed of with no costs, and related motions were closed as per the terms outlined in the judgment.