HC Sets Aside Tax Order for Breach of Natural Justice; Petitioner Must Pay 10% and Respond to Notice. The HC set aside the impugned tax assessment order due to a breach of principles of natural justice, acknowledging the petitioner's claim of unawareness ...
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HC Sets Aside Tax Order for Breach of Natural Justice; Petitioner Must Pay 10% and Respond to Notice.
The HC set aside the impugned tax assessment order due to a breach of principles of natural justice, acknowledging the petitioner's claim of unawareness caused by an inadvertent error in filling Form GSTR 3B. The court required the petitioner to remit 10% of the disputed tax within three weeks and respond to the show cause notice. Upon compliance, the respondent must offer a reasonable opportunity, including a personal hearing, and issue a new assessment order within three months. The case was disposed of without costs.
Issues involved: Breach of principles of natural justice in tax assessment, inadvertent error in filling Form GSTR 3B, non payment of tax under reverse charge mechanism.
Breach of principles of natural justice: The petitioner challenges an order dated 28.12.2023 on the basis of breach of principles of natural justice, claiming unawareness of proceedings due to the part-time Accountant's failure to inform about them. The petitioner asserts the need for an opportunity to contest the tax proposal arising from an inadvertent error in Form GSTR 3B, denying any short payment of GST.
Inadvertent error in filling Form GSTR 3B: The tax proposal in question relates to non-payment of tax under reverse charge mechanism due to an inadvertent error while filling up GSTR 3B returns. Acknowledging the inadvertent nature of the error, the court deems it just and necessary to allow the petitioner an opportunity to contest the tax demand on its merits.
Non-payment of tax under reverse charge mechanism: The impugned order is set aside with the condition that the petitioner remits 10% of the disputed tax demand within three weeks and submits a reply to the show cause notice within the same period. Upon satisfaction of the remittance and receipt of the reply, the respondent is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and issue a fresh assessment order within three months. The case is disposed of with no costs incurred.
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