Tax Recovery Notice Challenged: Partial Payment Ordered, Fresh Hearing Mandated Under Fair Procedural Guidelines HC allowed petitioner's challenge to tax recovery notice. The court set aside impugned orders and remanded the matter, directing petitioner to pay 10% of ...
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HC allowed petitioner's challenge to tax recovery notice. The court set aside impugned orders and remanded the matter, directing petitioner to pay 10% of disputed tax demand. Respondents must provide opportunity for personal hearing and issue fresh orders within three months. Writ petitions disposed without costs.
Issues: Challenge to tax proposal confirmation, interest imposition, and recovery notice in writ petitions.
Analysis: The petitioner, engaged in power aggregation services, sought cancellation of GST registration due to lack of business. Unaware of proceedings until receiving the recovery notice, the petitioner filed writ petitions. Counsel for the petitioner highlighted the lack of awareness post-registration cancellation and offered to remit 10% of the disputed tax demand for remand. The Government Advocate for respondents 1 & 2 acknowledged the preceding intimation, show cause notice, and reminders leading to the impugned order.
The order confirming the tax proposal revealed discrepancies between the petitioner's GSTR 3B return and auto-populated GSTR 2A, particularly significant following the GST registration cancellation. Recognizing the petitioner's limited reason to monitor the GST portal, the court deemed it just to allow the petitioner an opportunity to contest the tax demand on merits. Consequently, the impugned orders were set aside to provide the petitioner with a chance to contest the tax demand, subject to remitting 10% of the disputed tax demand within two weeks.
The matter was remanded for reconsideration by respondents 1 & 2, with the petitioner allowed to submit a reply to the show cause notice within the specified period. Upon satisfaction of the receipt of 10% of the disputed tax demand, respondents 1 & 2 were directed to provide the petitioner with a reasonable opportunity, including a personal hearing, and issue fresh orders within three months from receiving the petitioner's reply. The writ petitions were disposed of without costs, and connected miscellaneous petitions were closed.
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