2024 (7) TMI 601 - HC - GST

Taxpayer Wins Challenge to GST Assessment, Ordered to Deposit 10% and Provide Detailed Evidence Within 6 Months

M/s. NSK Builders Private Limited, rep. by its Director, NSK Kalairaja Versus Proper Officer/Sales State Tax Officer, Trichy

HC allowed the writ petition challenging a GST assessment order for 2017-18. The petitioner was directed to deposit 10% of disputed tax and submit a ... Challenge to assessment order - petitioner failed to reply to SCN - Violation of principles of natural justice - HELD THAT:- This is a fit case for remanding the case back by setting aside the impugned order subject to the petitioner depositing 10% of the disputed tax to the credit of the Government from its Electronic Cash Register within a period of 30 days from the date of receipt of a copy of this order. The impugned order, which stands quashed, shall be treated as addendum to the show cause notice in Form DRC-01 dated 29.09.2023. The petitioner shall file a reply together with all the evidences, which the petitioner seeks to rely within such time or within such period as may be extended by the respondent. It is expected that the entire proceeding will be completed by the respondent within a period of 6 months from the date of receipt of a copy of this order. Petition disposed off. Issues:Challenge to impugned order dated 30.12.2023 for assessment year 2017-18; Delay in responding to show cause notice; Request for opportunity to explain the case; Alternate remedy under Section 107 of GST enactment; Filing of writ petition beyond limitation period.Analysis:The petitioner challenged the impugned order dated 30.12.2023 issued by the respondent for the assessment year 2017-18. The petitioner received a show cause notice in DRC-01 on 29.09.2023 but failed to respond. Subsequently, personal hearing notices were issued, and the petitioner requested multiple adjournments. The petitioner claimed that a significant portion of the demand in the order related to services provided before the implementation of GST on 01.07.2017. Due to difficulties in obtaining necessary details post-show cause notice issuance, caused by monsoon and floods, the petitioner couldn't reply or attend hearings.The petitioner's counsel argued that a substantial amount of the demand was unjustified and requested an opportunity to present their case. They expressed confidence in convincing the Department regarding the remaining demand. Conversely, the Government Advocate contended that the petitioner had an alternative remedy under Section 107 of the GST enactment through the Appellate Deputy Commissioner, making the writ petition liable for dismissal.Moreover, the Government Advocate highlighted the delay in filing the writ petition beyond the limitation period, citing a Supreme Court decision in a similar case. After considering both parties' arguments, the Court deemed it appropriate to remand the case by setting aside the impugned order. The petitioner was directed to deposit 10% of the disputed tax to the Government within 30 days from receiving the order copy. The quashed order was to be treated as an addendum to the show cause notice, requiring the petitioner to submit a reply with all evidence within a specified timeframe, not exceeding 6 months from the order receipt.In conclusion, the writ petition was disposed of with no costs, and connected Miscellaneous Petitions were closed. The Court's decision aimed to facilitate a fair resolution of the matter while ensuring compliance with procedural requirements and timelines.