Tax Assessment Order Invalidated: Procedural Flaws Expose Violation of Natural Justice Principles in Revenue Proceedings

HC quashed tax assessment order due to procedural violations. The court found that tax authorities failed to provide personal hearing as mandated by law, breaching principles of natural justice. Order was remanded for reconsideration, directing respondent to issue fresh assessment within two months after giving petitioner opportunity to present documents and arguments.

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Issues involved:
The judgment involves the assessment order dated 30.12.2023 concerning tax demand arising from discrepancies between Form GSTR-1 and Form GSTR-2A. The main issues are the lack of personal hearing and violation of principles of natural justice.

Assessment of Tax Demand:
The petitioner, engaged in trading medical equipment, received notices and submitted replies requesting a personal hearing to present relevant documents. The impugned order was issued without providing a personal hearing despite requests, violating Section 75(4) of the Tamil Nadu Goods and Services Tax Act, 2017. The challenge was limited to Input Tax Credit (ITC) issue, as the demand related to outward supply was complied with.

Violation of Principles of Natural Justice:
The respondent failed to provide a personal hearing despite requests, leading to a breach of natural justice principles. The petitioner promptly replied to notices and requested time to respond, but the requests were disregarded. The impugned order was issued without due consideration, warranting interference.

Court Decision:
The High Court quashed the impugned order dated 30.12.2023 and remanded the matter for reconsideration. The respondent was directed to issue a fresh assessment order within two months, after providing a reasonable opportunity to the petitioner, including a personal hearing. The case was disposed of accordingly, with related motions closed.

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