2024 (7) TMI 596 - HC - GST

Tax Assessment Voided Due to Procedural Flaws: Authority Must Provide Complete Hearing and Review All Supporting Documents

JOSCO JEWELLERS PVT. LTD. Versus JOINT COMMISSIONER (TAXPAYER SERVICES), STATE GOODS AND SERVICES TAX DEPARTMENT, KOTTAYAM

HC found procedural irregularity in tax assessment order. The court determined that the assessing authority violated natural justice by not providing full ... Challenge to assessment order - petitioner was not asked to submit all the credit notes and invoices etc. and without giving further opportunity to produce all the documents and evidence, the assessment order has been passed - violation of principles of natural justice - HELD THAT:- If the petitioner had produced the sample credit notes and not all the credit notes, he should have been given opportunity to produce all the credit notes and substantiate his claim by producing the original invoices. The matter can be remanded back to the assessing authority to pass fresh orders. The petitioner is directed to appear before the assessing authority with all the relevant evidence and materials in support of his claim on 02.04.2024. The assessing authority will examine the evidence and after hearing the petitioner, shall pass a fresh order expeditiously in accordance with the law - Petition disposed off by way of remand. Issues: Impugning assessment order under CGST/SGST Act, violation of natural justice in passing assessment order without giving opportunity to produce all relevant documents.In this case, the writ petition was filed challenging the assessment order passed by the respondent under the provisions of Section 73(1) of the CGST/SGST Act, 2017 read with Section 20 of the IGST Act, 2017. The challenge was specifically on the grounds that the petitioner had accumulated a sale return amount in the Profit and Loss Account, and the assessing authority had not allowed the opportunity to produce all credit notes and invoices. The petitioner contended that the assessment order was passed without giving a fair chance to submit all relevant documents, violating the principle of natural justice.The petitioner responded to the show cause notice by submitting sample credit notes and fresh invoices, but was not asked to provide all the credit notes and invoices. The Senior Counsel argued that if given the opportunity, the petitioner could have proven the non-liability to pay the tax. The assessing authority was criticized for not requesting all relevant documents and evidence before passing the assessment order, leading to a breach of natural justice principles.The Government Pleader argued that the petitioner had sufficient opportunity to present evidence and documents, and any failure to do so was the petitioner's fault. However, the court noted that if only sample credit notes were submitted and not all, the petitioner should have been given a chance to produce all necessary documents and substantiate the claim with original invoices. The court concluded that the assessing authority had not provided this opportunity and decided to remand the matter back to the authority for fresh orders.The court directed the petitioner to appear before the assessing authority with all relevant evidence and materials to support the claim. The assessing authority was instructed to examine the evidence, hear the petitioner, and pass a fresh order promptly in compliance with the law. The petitioner was also informed of the option to seek legal recourse if aggrieved by the fresh order on remand. Consequently, the writ petition was disposed of, emphasizing the importance of providing a fair opportunity to present all relevant documents in tax assessment proceedings.