2024 (7) TMI 421 - HC - GST

Tax Assessment Challenge Upheld: Partial Relief Granted with Mandatory Personal Hearing and Deposit Requirement

M/s. Surral Surface Coating Pvt. Limited, Represented by its Director Versus The Assistant Commissioner (ST), Chennai

HC allowed partial challenge to tax assessment order. Petitioner challenged lack of personal hearing and IGST liability. Court remanded matter for ... Violation of principles of natural justice - petitioner was not provided a personal hearing - impugned order was issued without providing a personal hearing to the petitioner - HELD THAT:- On examining the impugned order, it appears that a personal hearing was not offered because the petitioner did not request for a personal hearing. As per sub-section (4) of Section 75 of applicable GST enactments, a personal hearing is required to be provided either if requested for or if an order adverse to the tax payer is proposed to be issued. For such reason, the matter requires reconsideration. By taking into account the fact that the petitioner accepted the liability as regards SGST and CGST components of the confirmed tax demand, remand is required only with regard to the IGST component. The impugned order dated 27.04.2024 is partly set aside subject to the petitioner remitting a sum of Rs. 75,000/- within 15 days from the date of receipt of a copy of this order only in so far as the confirmed tax demand, interest and penalty relating to the IGST component is concerned. As a consequence, the matter is remanded for reconsideration - petition disposed off. Issues:Challenge to assessment order due to lack of personal hearing, tax liability under IGST component, availability of Input Tax Credit (ITC), remand for reconsideration, compliance with GST enactments regarding personal hearing.Analysis:The judgment revolves around the challenge to an assessment order dated 27.04.2024 on the grounds of the petitioner not being provided a personal hearing. The petitioner had filed a reply to the show cause notice dated 27.12.2023, but the impugned order was issued without a personal hearing. The learned counsel for the petitioner argued that the tax liability under the IGST component was unjustly imposed, highlighting that the petitioner had not availed excess ITC based on GSTR 3B returns. The petitioner accepted liability for SGST and CGST but sought another opportunity to address the IGST component, agreeing to remit Rs. 75,000 as a condition for remand.The Government Advocate, representing the respondent, acknowledged receiving the petitioner's reply but pointed out that the petitioner did not mention the tally between available ITC and ITC availed of. The court observed that a personal hearing was not offered as the petitioner had not requested one, as required by Section 75(4) of GST enactments unless an adverse order was proposed. The judgment emphasized the need for reconsideration, specifically regarding the IGST component, due to the petitioner's acceptance of liability for SGST and CGST. However, the petitioner was put on terms for failing to state the tally of ITC in the earlier reply.Consequently, the impugned order was partly set aside, subject to the petitioner remitting Rs. 75,000 within 15 days concerning the IGST component. The matter was remanded for reconsideration, allowing the petitioner to file an additional reply. The respondent was directed to provide a reasonable opportunity, including a personal hearing, and issue a fresh order within three months upon compliance with the remittance condition. The writ petition was disposed of without costs, and connected miscellaneous petitions were closed.