2024 (12) TMI 1515 - HC - GST

Challenge to impugned order passed by the respondent - difference between the ITC available as per GSTR-2A and ITC availed as per GSTR-3B - HELD THAT - The impugned order passed by the respondent dated 27.04.2024 is hereby set aside. The petitioner shall deposit 25% of the disputed tax within a period of two weeks from the date of receipt of a copy of this order - the impugned order of assessment shall be treated as show cause notice and the petitioner shall submit its objections within a period of four weeks from the date of receipt of a copy of this order along with supporting documents/material. Petition disposed off.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment are:

• Whether the impugned order passed by the respondent on 27.04.2024, regarding the assessment year 2018-19, was validly served on the petitioner?
• Whether the petitioner was afforded a fair opportunity to respond to the discrepancies identified between the ITC available as per GSTR-2A and ITC availed as per GSTR-3B?
• Whether the petitioner should be granted an opportunity to present objections and evidence in response to the assessment order?
• What conditions, if any, should be imposed on the petitioner for granting such an opportunity?

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Validity of Service of the Impugned Order

• Relevant legal framework and precedents: The petitioner argued that the service of the assessment order was not in compliance with the procedures stipulated under the Goods and Services Tax Act, 2017, as it was uploaded on the GST Portal without proper notification.
• Court's interpretation and reasoning: The court noted that the petitioner claimed to be unaware of the proceedings due to the method of service and emphasized the importance of proper notification to ensure fair participation in adjudication.
• Key evidence and findings: The petitioner did not receive the order by tender or registered post, which led to their non-participation in the proceedings.
• Application of law to facts: The court considered the lack of proper service as a significant factor in deciding to set aside the impugned order.
• Treatment of competing arguments: The respondent did not contest the petitioner's claim regarding improper service.
• Conclusions: The court concluded that the service of the order was inadequate, justifying the setting aside of the impugned order.

Issue 2: Fair Opportunity to Respond

• Relevant legal framework and precedents: The petitioner cited a similar case where the court remanded the matter for reconsideration, subject to certain conditions.
• Court's interpretation and reasoning: The court recognized the petitioner's willingness to comply with conditions and the respondent's lack of objection as grounds to provide the petitioner with another opportunity.
• Key evidence and findings: The petitioner expressed readiness to pay 25% of the disputed tax and submit objections.
• Application of law to facts: The court applied principles of fairness and due process, allowing the petitioner to present their case.
• Treatment of competing arguments: The court considered the respondent's acquiescence to the petitioner's request for a rehearing.
• Conclusions: The court decided to set aside the impugned order and allow the petitioner to submit objections, subject to conditions.

3. SIGNIFICANT HOLDINGS

• Preserve verbatim quotes of crucial legal reasoning: "The impugned order passed by the respondent dated 27.04.2024 is hereby set aside and this Court is inclined to pass the following orders..."
• Core principles established: The judgment reinforces the necessity of proper service of orders and the opportunity for taxpayers to respond to discrepancies.
• Final determinations on each issue:
  
  • The impugned order was set aside due to improper service.
  • The petitioner was granted an opportunity to submit objections and evidence, subject to the payment of 25% of the disputed tax.
  • If the petitioner fails to comply with the conditions, the impugned order will be revived.
  
  

The court's decision emphasizes procedural fairness and the importance of proper communication in tax assessment proceedings, allowing the petitioner a fair chance to address the discrepancies identified by the tax authorities.