2024 (7) TMI 920 - HC - GST

Tax Proposal Challenged: Petitioner Granted Relief with Conditional Payment and Respondent Directed to Conduct Fair Hearing

HC allowed the writ petition challenging a tax proposal. The court set aside the original order, directing the petitioner to remit Rs. 25,000 towards the ... Principles of natural justice - petitioner did not have a reasonable opportunity to contest the tax proposal on merits - petitioner was unaware of proceedings culminating in the impugned order - disparity between the petitioner's GSTR 3B returns and the auto populated GSTR 2A - HELD THAT:- The petitioner has placed on record the declaration issued by the supplier in terms of Circular No.183. The rectification petition was rejected in view of the limited scope of rectification under Section 161 of the applicable GST statutes. In the affidavit, the petitioner asserts that non participation was on account of not being aware of proceedings. The petitioner has offered to remit a sum of Rs. 25,000/- towards the disputed tax demand and this is in excess of 10% of the disputed tax demand. These facts and circumstances justify re-consideration. The order in original dated 13.12.2023 is set aside on condition that the petitioner remits a sum of Rs. 25,000/- towards the disputed tax demand, as agreed to, within fifteen days from the date of receipt of a copy of this order. Within the said period, the petitioner is permitted to submit a reply to the show cause notice - Petition disposed off. Issues:Challenge to tax proposal due to lack of reasonable opportunity for contesting, compliance with principles of natural justice, rejection of rectification petition, disparity between GSTR 3B returns and GSTR 2A, remittance of disputed tax demand.Analysis:The writ petition challenges an order dated 13.12.2023, alleging the petitioner was not afforded a fair chance to contest the tax proposal on its merits. The petitioner claims ignorance of the proceedings leading to the impugned order, thus hindering participation in the process.The confirmed tax proposal concerns the variance between the petitioner's GSTR 3B returns and the auto-populated GSTR 2A. The petitioner, citing Circular No.183, submitted a rectification petition on 11.03.2024, which was subsequently rejected on 04.04.2024. The petitioner, through counsel, expresses willingness to pay Rs. 25,000 towards the disputed tax demand as a condition for reconsideration.The Government Advocate asserts that principles of natural justice were adhered to by notifying the petitioner through multiple channels, including the GST portal, registered email, and mobile number. The petitioner presented a declaration from the supplier per Circular No.183, and the rectification petition was turned down due to statutory limitations. The petitioner's claim of non-participation due to lack of awareness is supported by an offer to pay Rs. 25,000, exceeding 10% of the disputed tax demand, warranting reconsideration.Consequently, the court sets aside the original order subject to the petitioner remitting Rs. 25,000 towards the disputed tax demand within fifteen days. The petitioner is granted the opportunity to respond to the show cause notice within the same period. Upon confirmation of the payment and review of the response, the respondent is directed to provide a fair opportunity, including a personal hearing, and issue a fresh order within three months.In conclusion, the writ petition is disposed of with no costs, and associated motions are closed as per the specified terms.