2024 (9) TMI 437 - HC - GST

Challenge to Tax Assessment Overruled: 7.5% Payment Mandated, Opportunity for Reassessment Preserved Under GST Regulations

Dynamed Equipments Versus The Assistant Commissioner (ST) Intelligence-I, Chennai

The SC examined GST assessment orders challenging tax demands for 2018-19 and 2019-20. The Court found the appellant was provided opportunities to ... Challenge to Assessment and demand orders - validity of SCN - SCN had been given only with regard to the proposal of assessing tax and not for the interest and imposing of the penalty. Discrepancy in the assessment amount compared to the proposal - HELD THAT:- On going through the SCN as well as the final order passed by the assessing authority and as pointed out by the learned Government Advocate appearing for the respondent Revenue, it is found that both in the show cause notice as well as in the final assessment order, the proposal under nine heads have been mentioned and has been considered and final order also had been passed for all the nine heads. Violation of Section 75(7) of the GST Act - HELD THAT:- There are no reason to accept the contention of the learned counsel for the appellant, the reason being that, since the amount mentioned in the proposal, if it is calculated totally under the nine heads, certainly that would match with the final figure arrived at by the assessing authority in the final assessment order. Moreover, now by virtue of the order that has been made by the writ Court, of course on payment of 10% of the disputed tax, for which the appellant agreed upon before the writ Court, the second contention also cannot be countenanced. There are no plausible reason to interfere with the order passed by the writ Court, which is impugned in these writ appeals - the impugned order affirmed - order slightly modified, to make payment of 7.5% of the disputed tax instead of 10% as ordered by the writ Court, within a period of three months from the date of receipt of a copy of this order. On making such payment, the assessing authority shall proceed with the re-assessment as per the remand order passed by the writ Court through the impugned order and, after giving an opportunity of being heard to the appellant / assessee, final decision shall be made on merits and in accordance with law. It is made clear that if the modified condition of making the payment of 7.5% of the disputed tax is not complied within the time limit stipulated. Appeal disposed off. Issues:1. Assessment and demand orders challenged in writ petitions.2. Lack of opportunity to respond to interest and penalty proposals.3. Discrepancy in the assessment amount compared to the proposal.4. Alleged violation of Section 75(7) of the GST Act.Analysis:1. The appellant challenged the assessment and demand orders issued by the assessing authority, claiming lack of participation in assessment proceedings and no response to show cause notices. The writ petitions were filed against the tax demands for the assessment years 2018-19 and 2019-20.2. The writ Court found that while the appellant was given opportunities, there was no response to the interest and penalty proposals. The Court decided to interfere with the order concerning interest and penalty, as the appellant did not have a chance to address these aspects despite several opportunities provided.3. The appellant contended that the assessing authority only considered five out of the nine issues proposed initially, leading to prejudice upon remand for reassessment. However, upon review, it was established that all nine issues were addressed in both the show cause notice and the final assessment order, refuting the appellant's contention.4. Regarding the alleged violation of Section 75(7) of the GST Act due to an enhanced assessment amount compared to the proposal, the Court examined the provision and found no merit in the appellant's argument. The final figure arrived at by the assessing authority aligned with the proposal under the nine heads, and the modification to pay 7.5% of the disputed tax was deemed acceptable.5. Ultimately, the Court affirmed the writ Court's order but modified the payment condition to 7.5% of the disputed tax within three months. Failure to comply would allow the assessing authority to proceed with reassessment based on available records. The appellant was granted an opportunity to be heard before a final decision was made in accordance with the law.6. The writ appeals were disposed of with no costs, emphasizing compliance with the modified payment condition within the stipulated timeframe for further proceedings in the reassessment process.