2023 (12) TMI 1283 - HC - GST

GST Assessment Order Invalidated Due to Lack of Proper Notice, Petitioner Granted Opportunity to Respond and Seek Fresh Assessment

VADAKKOOT CHACKOO DEVASSY Versus ASSISTANT STATE TAX OFFICER, CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS, THE GOODS AND SERVICE TAX COUNCIL, STATE OF KERALA, UNION OF INDIA

HC found a violation of natural justice in the GST assessment order. The order was issued without proper notice after the petitioner's registration was ... Cancellation of petitioner's registration before issuance of the notices - petitioner was not granted any time in the notice so issued in GST ASMT-10 - violation of principles of natural justice - HELD THAT:- Since the petitioner's registration had been cancelled before issuance of the said notices, the petitioner did not file reply to the said show cause notices. Otherwise, the petitioner was not granted any time in the notice so issued in GST ASMT-10 and therefore, there has been violation of the principles of natural justice in passing the assessment order, Ext.P5 - there are substance in the submission advanced by the learned counsel for the petitioner. Notice in Ext.P2 disclosed that it is dated 29.9.2023 and on the very next day, Ext.P3 notice under Section 73 was issued. The petitioner was not afforded any time for filing reply to the notice in GST ASMT-10. There is violation of the principles of natural justice and, therefore, the impugned assessment order, Ext.P5, is unsustainable and the same is hereby set aside. The matter is remanded back to the file of the assessing authority, 1st respondent, to pass fresh a order. Petition allowed by way of remand. Issues involved: Violation of principles of natural justice in passing assessment order, Challenge to the validity of section 16(4) of the CGST/SGST Act, 2017The petitioner filed a writ petition seeking the quashing of Exhibit P5 order and P6 summary of order in Form GST DRC-07, alleging violation of natural justice and limitation. The petitioner also requested the invocation of powers under section 172 of the CGST/SGST Act, 2017 to address difficulties faced by taxable persons in availing input tax credit from belatedly filed returns and challenged the constitutionality of section 16(4) of the CGST/SGST Act, 2017.The Court noted that the petitioner was issued a notice in Form GST ASMT-10 and a show cause notice under Section 73 of the CGST Act, 2017, without receiving physical copies, as they were uploaded on the GST portal. The petitioner's registration had been cancelled before the issuance of these notices, leading to the petitioner not filing a reply. The Court observed a lack of time granted for the petitioner to respond to the notices, indicating a violation of natural justice in passing the assessment order, Ext.P5.The Court found merit in the petitioner's argument, highlighting that the notices were issued one after the other without affording the petitioner an opportunity to respond. Additionally, the petitioner's GST registration had been cancelled before the notices were uploaded on the portal, further supporting the violation of natural justice in the assessment process.Consequently, the Court held that the impugned assessment order, Ext.P5, was unsustainable due to the violation of natural justice. The order was set aside, and the matter was remanded to the assessing authority for a fresh order. The petitioner was granted three days to file a reply to the show cause notice dated 30.9.2023, and the assessing authority was directed to provide an opportunity for the petitioner before finalizing the fresh assessment. The petitioner was barred from raising any grounds regarding the limitation in finalizing the assessment for the relevant year.In conclusion, the writ petition was disposed of with the above observations and directions, while any pending interlocutory application was dismissed.