2024 (9) TMI 984 - HC - GST

Violation of principles of natural justice - entitlement to cenvat credit under GST transition rules - HELD THAT - The petitioner appears to be a registered person under applicable GST enactments as on date. As a registered person, the petitioner is under an obligation to monitor the GST portal on an ongoing basis. The present state of affairs has transpired on account of the petitioner not monitoring the GST portal and responding to the show cause notice and hearing notices. At the same time, it should be noticed that transitional credit was reversed under the impugned order without hearing the petitioner. The petitioner contends that the respondent did not have the authority to question eligibility when the same was not questioned under the erstwhile regime when the petitioner availed of cenvat credit. It is, therefore, just and necessary to provide an opportunity to the petitioner to contest the tax demand, albeit by putting the petitioner on terms. The impugned order dated 29.12.2023 is set aside on condition that the petitioner remits 10% of the disputed tax demand with in three weeks from the date of receipt of a copy of this order - Petition disposed off.

Summary

The High Court of Madras set aside the order dated 29.12.2023 due to non-compliance with principles of natural justice. The petitioner, a manufacturer of PVC pipes, claimed entitlement to cenvat credit under GST transition rules. The court directed the petitioner to remit 10% of the disputed tax demand within three weeks and allowed them to submit a reply to the show cause notice. The respondent was instructed to provide a reasonable opportunity for a personal hearing and issue a fresh order within two months. Case W.P.No.9613 of 2024 was disposed of accordingly, with no costs.