2024 (4) TMI 57 - HC - GST

Procedural Fairness Prevails: GST Assessment Order Quashed Due to Lack of Proper Hearing Opportunity for Petitioner

The HC allowed the petitioner's writ petition challenging GST assessment and recovery orders. The court found insufficient hearing opportunity, quashed ... Recovery notices and bank attachment orders - Validity of assessment order - No opportunity of being heard - discrepancies between the GSTR 3B return and the GSTR 2B return - HELD THAT:- On perusal of the impugned assessment order, it is evident that the tax liability and interest and penalty was levied in respect thereof. By taking into account the fact that about 50% of the tax liability was recovered by making an appropriation from the petitioner's bank account, it is just and necessary to provide the petitioner an opportunity of being heard. Solely for that reason, the impugned order calls for interference. Impugned order is set aside and the matter is remanded for reconsideration. The petitioner is permitted to submit a reply to the show cause notice within a period of 15 days from the date of receipt of a copy of this order by annexing all relevant documents. Upon receipt thereof, the respondent is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and thereafter issue a fresh order within a period of two months from the date of receipt of the petitioner's reply. In view of the assessment order being quashed, the bank attachment stands raised. The writ petition is disposed of on the above terms. Issues involved: Challenge to assessment order, recovery notices, attachment orders without hearing the petitioner.Summary:The petitioner, engaged in trading provisions and vegetables, challenged an assessment order dated 07.06.2023, along with recovery notices and attachment orders, as he was not given an opportunity to be heard. The petitioner received a show cause notice on 06.03.2023 regarding discrepancies in GST returns, but did not reply due to lack of communication from his GST consultant. Subsequently, a recovery notice was issued on 18.12.2023, and a significant amount was deducted from the petitioner's bank account. The petitioner filed a writ petition seeking relief.The petitioner's counsel argued that the confirmed tax liability was Rs. 10,89,028, but only about Rs. 5,39,000 was recovered from the bank account without hearing the petitioner. The petitioner had also submitted a reply on 08.03.2024, requesting another opportunity to be heard.The Government Advocate for the respondent mentioned that multiple notices were issued to the petitioner before the impugned order, including an intimation, show cause notice, and a personal hearing/reminder notice. She contended that since sufficient opportunities were given to the petitioner, there was no need for interference.Upon reviewing the documents, including the petitioner's bank statement showing deductions towards tax liability, and considering that only 50% of the tax liability was recovered without a hearing, the court found it necessary to set aside the impugned order dated 07.06.2023. The matter was remanded for reconsideration, allowing the petitioner to submit a reply within 15 days and requiring the respondent to provide a reasonable opportunity for a personal hearing before issuing a fresh order within two months.Consequently, the assessment order was quashed, and the bank attachment was lifted. The writ petition was disposed of with no costs, and connected miscellaneous petitions were closed.