Order Quashed for Non-Compliance with Personal Hearing Rule Under Tamil Nadu SGST Act; Case Remanded for Reassessment.

The HC quashed the impugned order dated 29.12.2023 due to non-compliance with Section 75(4) of the Tamil Nadu SGST Act, 2017, which mandates a personal hearing upon request. The matter was remanded for reconsideration, directing the assessing officer to provide a personal hearing and reassess within two months. The writ petition was disposed of without costs, and related petitions were closed.

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Issues involved:
The petitioner challenges an order dated 29.12.2023, primarily on the ground of lack of personal hearing.

Details of the Judgment:

Issue 1: Lack of Personal Hearing
The petitioner, a construction equipment manufacturer and a registered person under GST laws, received a show cause notice dated 29.09.2023 following an audit of their books of accounts under applicable GST laws. The petitioner replied to the notice on 24.10.2023 and requested a personal hearing. However, the impugned order was issued on 29.12.2023 without providing the requested personal hearing.

The petitioner's counsel argued that the failure to offer a personal hearing severely prejudiced the petitioner. For instance, in response to the show cause notice regarding trade payables, the petitioner had clearly stated that no payments for supplies were made beyond 180 days, supported by a trade payables ageing report. Despite this, the assessment order confirmed a tax demand of approximately Rs.5.7 crores citing the petitioner's failure to produce payment details and other documents. The counsel contended that if a personal hearing had been granted, such a significant tax demand would not have been confirmed.

Issue 2: Compliance with Document Submission
The Government Advocate representing the respondents argued that the assessment order was issued because the petitioner did not provide all necessary documents, which could have been attached to the petitioner's reply dated 24.10.2023.

Judgment
Section 75(4) of the Tamil Nadu State Goods and Services Tax Act, 2017 mandates a personal hearing either upon request or if an adverse order is proposed. As the petitioner had explicitly requested a personal hearing in their reply dated 24.10.2023, and several findings in the assessment order were based on the petitioner's alleged failure to provide supporting documents, the court found grounds for interference. Consequently, the impugned order dated 29.12.2023 was quashed, and the matter was remanded for reconsideration. The assessing officer was directed to afford a reasonable opportunity to the petitioner, including a personal hearing, consider the documents submitted, and then issue a fresh assessment order within two months.

The writ petition was disposed of with no order as to costs, and connected miscellaneous petitions were closed.

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