2024 (12) TMI 726 - HC - GST

Excess claims of Input Tax Credit (ITC) - short payment of tax - defects related to the discrepancies in sale invoices and differences in turnover reported between GSTR 3B and TDS received from the Government Departments - penalty at 100% imposed u/s 74 of the Tamil Nadu Goods and Services Tax (TNGST) Act, 2017 - HELD THAT - Considering the submissions made by the learned counsel on both sides, the impugned assessment orders dated 29.02.2024 and 09.03.2024 respectively are hereby set aside - The petitioner shall deposit a sum of Rs. 25,00,000/- apart from the amount i.e., Rs. 11,36,408/-, already paid by the petitioner on 29.05.2024, within a period three weeks from the date of receipt of a copy of this order. The writ petition stands disposed of.

Summary

Issues:
Challenging impugned assessment orders for multiple assessment years based on excess claims of Input Tax Credit and other discrepancies. Violation of principles of natural justice due to lack of show cause notice and inability to access portal. Request for final opportunity to present objections before adjudicating authority.

Analysis:
The petitioner, a company engaged in contracting and building services, challenged assessment orders for six assessment years alleging excess claims of Input Tax Credit, short payment of tax, and interest on shortfall. The respondent determined tax payable for each assessment year based on discrepancies in sale invoices and turnover reported. A penalty of 100% was imposed under Section 74 of the TNST Act, 2017.

The petitioner contended that no show cause notice or Form DRC-01A was served directly, violating the principles of audi alteram partem. The petitioner's proprietor faced health issues, leading to his inability to access the portal or respond to notices before his demise. The petitioner had paid a partial amount towards the demand under appeal and expressed willingness to pay the disputed tax amount, seeking a final opportunity to present objections.

The respondent argued that the assessment orders were passed within the limitation period, and the writ petition was filed belatedly. The respondent proposed reconsideration if the petitioner paid 25% of the disputed amount. After hearing both sides, the court set aside the assessment orders and issued specific directions. The petitioner was required to deposit a specified amount within three weeks, treat the assessment order as a show cause notice, submit objections with supporting documents within four weeks, and the respondent would pass orders after a hearing.

Failure to comply with the deposit or objection submission timelines would result in the revival of the assessment orders. The court disposed of the writ petition with the provided directions, closing connected miscellaneous petitions without costs.