2024 (5) TMI 361 - HC - GST

Validity of assessment order - challenge to assessment order on the ground that the Petitioner s reply dated 01.03.2023 was not duly taken into account - benefit of Input Tax Credit - HELD THAT - On perusal of the impugned order it is evident that two purchase bills that were submitted by the Petitioner as enclosures to the reply dated 05.01.2023 were referred to therein. However there is no reference therein to the subsequent reply dated 01.03.2023. The Petitioner has approached this Court almost one year after the impugned order was issued. In these circumstances reconsideration is warranted by putting the Petitioner on terms. The impugned order dated 09.05.2023 is set aside on condition that the Petitioner remits 15% of the disputed tax demand within a period of two weeks from the date of receipt of a copy of this order. Within the aforesaid period the Petitioner is permitted to submit a further reply by enclosing all relevant documents - Petition is disposed off.

Issues involved: Challenge to assessment order based on non-consideration of petitioner's reply, entitlement to input tax credit for goods carriage services, non-consideration of subsequent reply, need for reconsideration of impugned order.

Issue 1 - Non-consideration of petitioner's reply:
The Writ Petition challenges an assessment order dated 09.05.2023 on the grounds that the Petitioner's reply dated 01.03.2023 was not duly taken into account. The Petitioner argues that their response, stating that vehicles were purchased for carrying goods and qualifying as capital goods for input tax credit, was not considered in the impugned order. The Petitioner, through counsel, agrees to remit 15% of the disputed tax demand as a condition for remand due to being unaware of the issuance of the impugned order.

Issue 2 - Entitlement to input tax credit for goods carriage services:
The Petitioner, a provider of goods carriage services, contends that they are entitled to avail of the benefit of input tax credit for purchasing vehicles to carry goods. Despite submitting purchase bills and clarifying the nature of the purchases in their replies, the impugned order allegedly failed to consider this aspect. The Respondent, represented by Mr. C. Harsha Raj, argues that the Petitioner did not provide financial statements or explain why the bills were not reflected in GSTR-2A, emphasizing the need to apportion the input tax credit over the life of capital goods.

Issue 3 - Non-consideration of subsequent reply:
The impugned order did not reference the subsequent reply dated 01.03.2023 where the Petitioner reiterated their position on the nature of the purchased vehicles. The Petitioner approached the Court almost a year after the issuance of the impugned order, seeking reconsideration and providing an opportunity to submit further documents for review.

Conclusion:
The High Court sets aside the impugned order dated 09.05.2023 on the condition that the Petitioner remits 15% of the disputed tax demand within two weeks. The Petitioner is allowed to submit a further reply with relevant documents within this period. Upon satisfaction of the remittance, the Respondent must provide a reasonable opportunity for the Petitioner, including a personal hearing, and issue fresh orders within three months. The bank attachment is lifted due to the setting aside of the assessment order. The Writ Petition is disposed of with no costs, and the connected matters are closed.

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