2024 (4) TMI 777 - HC - GST

Validity of impugned assessment order - reply to SCN given or not - violation of principles of natural justice - HELD THAT - The petitioner is a small time contractor who has incurred the liability in the impugned order for a sum of Rs. 2,77,524/-. The petitioner has also been imposed with penalty of Rs. 27,752/- and interest of Rs. 15,192/-. It appears that petitioner is a semi literate person and may have not been fully aware of the implications of the notices issued by the Tax Department. Considering the same, this Court is inclined to give a partial relief to the petitioner by setting aside the impugned order and remitting the case back to the respondent to pass a fresh order on merits within a period of 60 days from the date of receipt of a copy of this order provided the petitioner furnishes all the documents that were called for along with a reply to the notice and also pays a token amount equivalent to 10% of the disputed tax to the department. Subject to such compliance, respondent may proceed to adjudicate the issue afresh. The writ petition is disposed off.

Summary

Issues involved: Challenge to assessment order u/s 73 of TNGST Act 2017, failure to respond to show cause notices, imposition of tax, penalty, and interest, lack of awareness of proceedings by the petitioner.

Assessment Order Challenge: The petitioner challenged the assessment order dated 09.08.2023, contending that the tax amount was paid at 6% as the work was undertaken before June 2022. Despite receiving show cause notices and personal hearing notices, the petitioner did not respond. The tax department proposed to levy CGST and SGST, penalty u/s 73 of TNGST Act 2017, and interest at 18% u/s 50(3). The total demand was Rs. 2,77,524/- with penalty and interest included.

Failure to Respond to Notices: The petitioner failed to respond to the show cause notice and subsequent hearing notices, leading to the confirmation of the proposed demand. The petitioner claimed to have replied earlier, which was allegedly not considered. The petitioner cited unawareness of the hearing dates and the hosting of the order on the web portal as reasons for non-participation, seeking to set aside the impugned order.

Legal Opposition: The respondent opposed the Writ Petition, arguing that the petitioner deliberately ignored the notices and failed to produce requested documents. Citing a Supreme Court decision, the respondent contended that the statutory appeal period had expired. The respondent maintained that the impugned order was valid and warranted no interference.

Court's Decision: Acknowledging the petitioner's limited understanding of the proceedings, the Court granted partial relief by setting aside the impugned order. The case was remitted back to the respondent for a fresh order within 60 days, subject to the petitioner providing all necessary documents, responding to the notice, and paying 10% of the disputed tax. Failure to comply would result in the order being vacated, allowing the department to proceed with recovery. The Writ petition was disposed of with no costs, and related petitions were closed accordingly.