Tax Assessment Order Invalidated: Procedural Flaws Require Rehearing and Compliance with Statutory Guidelines Under Section 143

HC quashed the tax assessment order due to procedural irregularities. The petitioner was directed to remit Rs. 15,00,000/- within two weeks and submit a reply to the show cause notice. The assessing officer must provide a personal hearing and issue a fresh assessment order within two months, following prescribed procedural guidelines. The writ petition was disposed of without costs.

---

---

Issues Involved:
The judgment addresses the breach of principles of natural justice in an assessment order under Section 67 of the Tamil Nadu Goods and Services Tax Act 2017.

Assessment Proceedings:
The petitioner challenged an assessment order dated 27.12.2023, citing a breach of natural justice principles. The inspection conducted earlier revealed 15 discrepancies, to which the petitioner responded. However, despite requesting an extension, a show cause notice was issued on 29.09.2023, followed by the impugned assessment order.

Contentions and Submissions:
The petitioner's counsel argued that all discrepancies, including Input Tax Credit (ITC) reversal and turnover from specific regions, were addressed in the petitioner's replies during the inspection. The petitioner claimed entitlement to ITC for delayed payments subject to interest. It was highlighted that the petitioner's responses were disregarded in subsequent stages, leading to the inclusion of certain turnovers in the assessment order against the petitioner's requests.

Resolution and Order:
The petitioner agreed to remit Rs. 15,00,000/-, attributing 10% of the disputed tax demand under seven heads. The Additional Government Pleader contended that the petitioner had sufficient opportunities to contest the tax demand, including multiple personal hearing offers. The Court noted that although the petitioner responded to discrepancies during inspection, failure to engage in subsequent stages warranted interference in the assessment order, subject to the petitioner's compliance with the remittance condition.

Final Decision:
The Court quashed the assessment order, subject to the petitioner remitting Rs. 15,00,000/- within two weeks and submitting a reply to the show cause notice within the same period. Upon receipt of the remittance and reply, the assessing officer was directed to provide a reasonable opportunity for a personal hearing and issue a fresh assessment order within two months. The assessing officer was instructed to follow the procedure outlined in Circular No.12/2022 dated 26.09.2022. The writ petition was disposed of with no costs awarded, and connected miscellaneous petitions were closed.

---