2024 (9) TMI 903 - HC - GST

Challenge to assessment order - mismatch of tax liability filed by the petitioner for the financial year 2017-2018 - opportunity of personal hearing not provided to petitioner - violation of principles of natural justice - HELD THAT - It is evident that the impugned show cause notice was uploaded on the GST Portal Tab. According to the petitioner, the petitioner was not aware of the issuance of the show cause notice issued through the GST Portal and the original of the said show cause notice was not furnished to them. In such circumstances, this Court is of the view that the impugned order came to be passed without affording any opportunity of personal hearing to the petitioner to establish its case, thereby violating the principles of natural justice and that it is just and necessary to provide an opportunity to the petitioner to establish their case on merits and in accordance with law. The order impugned herein is set aside and the matter is remanded to the first respondent for fresh consideration in respect of the impugned assessement period. Since 20% of the disputed tax liability has already been paid by the petitioner, this Court is not inclined to impose any further condition - Petition disposed off by way of remand.

Summary

Issues:
Challenge to order dated 28.12.2023 for Assessment Year 2017-2018 due to tax liability mismatch, failure to serve physical copy of order, demand for payment, attachment of bank account, violation of natural justice.

Analysis:
The petitioner filed a Writ Petition challenging the order passed by the first respondent for the Assessment Year 2017-2018, alleging a tax liability mismatch. The respondents demanded payment of the differential amount due to the alleged mismatch. The petitioner claimed that they were unaware of the show cause notice issued through the GST Portal and that the physical copy of the notice was not provided to them. The petitioner also highlighted that their bank account was attached, and 20% of the disputed tax liability was already collected by the respondents.

The petitioner's counsel argued that the petitioner was not informed about the proceedings until a Recovery Notice was issued proposing to attach the bank account. The petitioner sought an opportunity to present their case by filing a suitable reply and participating in the proceedings. The respondents' counsel stated that the court could consider passing appropriate orders subject to verifying the payment made by the petitioner.

After hearing both parties and examining the evidence, the court found that the impugned order was passed without affording the petitioner an opportunity for a personal hearing, thus violating the principles of natural justice. Consequently, the court decided to set aside the order dated 28.12.2023 and remand the matter to the first respondent for fresh consideration regarding the assessment period. The court directed the petitioner to file their reply within two weeks and instructed the respondents to issue a clear notice for a personal hearing. The court also ordered the lifting of the bank account attachment and directed the bank to de-freeze the account upon production of the court's order.

In conclusion, the court disposed of the writ petition with the above directions, without imposing any costs. The connected miscellaneous petition was also closed as a result of the judgment.