2024 (7) TMI 1196 - HC - GST

Violation of principles of natural justice - Challenge to assessment order - personal hearing was not offered - petitioner's reply was disregarded - disparity between the turnover reported in returns filed under the GST enactments and the turnover reflected in the profit and loss account - HELD THAT - Upon examining the petitioner's reply dated 12.12.2023, it follows that the explanation of the petitioner is that the turnover of Rs.6,73,26,009/- is attributable to the pre-GST period running from 01.04.2017 to 30.06.2017. It also appears that the petitioner did not place on record documents to establish that this turnover is attributable to the pre-GST period. In the impugned order, the respondent has taken note of the fact that the VAT returns for the said period indicated 'Nil' turnover. The conclusion of the respondent on this count cannot be completely disregarded as devoid of merit. The petitioner's explanation is that an inadvertent mistake was committed while filing the GSTR 9C return. In support of this contention, the certificate dated 02.12.2023 of the Chartered Accountant was submitted. On this issue, it appears that the profit and loss account corroborates the assertion in the Chartered Accountant's certificate. These aspects were disregarded while confirming the demand. Significantly, it is noticeable that no personal hearing was offered after the petitioner submitted a reply dated 12.12.2023. When all these facts and circumstances are considered cumulatively, the impugned order calls for interference so as to provide another opportunity to the petitioner. The petitioner is permitted to submit all relevant documents before the respondent within a period of 15 days from the date of receipt of a copy of this order. Upon receipt thereof, the respondent is directed to reconsider the matter - petition disposed off by way of remand.

Summary

Issues Involved:
Challenging an order due to lack of personal hearing and disregard of petitioner's reply.

Analysis:
The petitioner, engaged in road and civil contracts, received a show cause notice citing discrepancies. The petitioner's responses were allegedly disregarded for defects related to turnover differences and erroneous entries in returns. The petitioner argued that explanations were not considered and no personal hearing was granted, violating principles of natural justice. The respondent contended that the turnover disparity was not substantiated with documents and a personal hearing was provided. The court noted the lack of evidence supporting turnover attribution to the pre-GST period and the respondent's consideration of VAT returns showing 'Nil' turnover. Regarding another defect, the petitioner's explanation was supported by a Chartered Accountant's certificate, which was overlooked. The court found that relevant documents were not considered, and a personal hearing was not offered after the petitioner's reply. Consequently, the impugned order was quashed for defects 1, 2, and 4, allowing the petitioner to submit documents within 15 days for reconsideration. The respondent was directed to issue a fresh order within two months, providing a reasonable opportunity, including a personal hearing. The writ petition was disposed of without costs.

This detailed analysis of the judgment addresses the issues raised by the petitioner regarding the lack of a personal hearing and the alleged disregard of responses, providing a comprehensive understanding of the court's decision and reasoning behind quashing the impugned order for specific defects and granting the petitioner an opportunity for reconsideration.