2024 (6) TMI 1162 - HC - GST

Violation of principles of natural justice - SCN was uploaded on the portal but not communicated to the petitioner through any other mode - petitioner was unaware of such show cause notice and did not reply to the same - HELD THAT - The petitioner's reply dated 29.07.2022 indicates that the sales turnover as per the return in Form CMP-08 was Rs. 6,37,595/-. In the impugned order, the turnover of Rs. 5,47,405/- was taken into account. It appears that this sum was compared with the purchase value as per the supplier's GSTR 1 statement. The tax proposal was confirmed on the basis that the tax payer did not respond to the show cause notice. In view of the assertion that the tax payer could not participate in proceedings on account of being unaware of the same, the interest of justice warrants that the petitioner be provided an opportunity by putting the petitioner on terms. The impugned order dated 18.08.2023 is set aside subject to the condition that the petitioner remits 10% of the disputed tax demand as agreed to within a period of 15 days from the date of receipt of a copy of this order. The petitioner is permitted to submit a reply to the show cause notice within the aforesaid period - Petition disposed off.

Summary

Issues:
Breach of principles of natural justice in an order dated 18.08.2023.

Analysis:
The petitioner, engaged in selling electrical and plumbing hardware, opted for the composition scheme and filed returns in Form GSTR 4 and CMP-08. The petitioner received a notice dated 15.07.2022 but claimed to be unaware of a subsequent show cause notice dated 28.11.2022 as it was only uploaded on the portal, not communicated through other means. The petitioner's counsel argued that the turnover reported in Form CMP-08 was not considered in the impugned order and requested another opportunity, agreeing to remit 10% of the disputed tax demand for a remand.

The respondent, represented by the Additional Government Pleader, contended that natural justice principles were adhered to by issuing intimation and the show cause notice. The impugned order considered a turnover different from what the petitioner reported, basing the tax proposal on non-response to the show cause notice. Recognizing the petitioner's claim of being unaware of the proceedings, the court deemed it necessary to provide an opportunity, setting aside the order subject to the condition of remitting 10% of the disputed tax demand within 15 days and submitting a reply within that period. Upon satisfaction of the remittance, the respondent was directed to offer a reasonable opportunity, including a personal hearing, and issue a fresh order within three months from receiving the petitioner's reply.

In conclusion, the writ petition was disposed of with no costs, and connected miscellaneous petitions were closed. The court's decision aimed to uphold principles of natural justice, ensuring a fair opportunity for the petitioner to address the tax dispute and participate in the proceedings effectively.