2020 (10) TMI 196 - HC - GST

Partial win in writ petition under Section 107(1) of GST Act emphasizes need for reasoned decisions

The court partially allowed the writ petition, setting aside the order under Section 107(1) of the Chhattisgarh Goods and Service Tax Act, 2017. The ... Principles of Natural justice - late filing of return - intent to evade or not - it is the case of petitioner is that various aspects have not been dealt with or discussed by the Appellate Authority though in the impugned Order he has referred to these grounds which the Petitioner has raised in their Appeal - HELD THAT:- It is true that the Appellate Authority in the impugned Order has reproduced most of the grounds that the Petitioner has raised in their Appeal. However, when we look into the impugned Order, all what is reflected is that the Appellate Authority has literally considered only the factual aspects of the case, that is, the date on which the Petitioner was supposed to submit their return and the defaults on the part of the Petitioner and the factual details in respect of the statutory provisions as is required. In addition, the order also reflects the date on which the demand notices were issued to the Petitioner. However, none of these paragraphs have the Appellate Authority's dealing with the specific objections and grounds that the Petitioner has raised in their memo of Appeal. It is by now a well settled position of law that the Appellate Authority while deciding the Appeal is duty bound to consider the grounds of challenge. The Appellate Authority is also required to pass a reasoned and speaking order considering and dealing with those grounds. The impugned Order in the instant case, which is the order passed by the Appellate Authority, seems to be more of an order passed by the Assessing Authority rather than an order passed by the Appellate Authority - In the opinion of this Court, the Appeal has not been justifiably decided and therefore the same deserves to be remitted back to the Appellate Authority for passing of a reasoned and speaking order dealing with the grounds raised in the Appeal challenging the order passed by the Assessing Authority on 20.8.2018. The matter stands remitted back to Respondent No.3-Appellate Authority for deciding the Appeal afresh specifically dealing with the grounds raised in the memo of Appeal by the Petitioner- Company, which also find place in the impugned Order - Petition allowed by way of remand. Issues involved:Challenge to order under Section 107(1) of the Chhattisgarh Goods and Service Tax Act, 2017.Analysis:The petitioner challenged an order imposing tax liability, interest, and penalty. The petitioner contended that despite submitting returns on time, a technical error showed a zero return, promptly rectified. The petitioner emphasized their good faith by immediately paying the balance due with subsequent returns. The petitioner argued that the authorities failed to consider entitled tax credits, affecting interest and penalty calculations. The appellate authority's order did not address these key points, prompting the petitioner's challenge.The Additional Advocate General argued that the appellate authority's order was self-explanatory regarding the petitioner's liability. Notably, the petitioner did not participate during the hearing, limiting their ability to raise issues later. However, the court observed that the appellate authority mainly focused on factual aspects, statutory provisions, and timelines, neglecting the petitioner's specific objections and grounds from the appeal memo.The court emphasized that the appellate authority must consider and address all grounds of challenge, providing a reasoned order. Citing legal precedent, the court stressed that arbitrary orders lacking proper reasoning are legally unsustainable. Consequently, the court set aside the impugned order, remitting the matter back to the appellate authority for a fresh decision, instructing a thorough consideration of the petitioner's raised grounds and granting the petitioner another hearing opportunity.In conclusion, the court partially allowed the writ petition, directing a fresh consideration of the appeal with proper adherence to legal principles, emphasizing the importance of reasoned orders and due application of mind by authorities.