GST demand set aside conditionally, with remand for fresh adjudication after deposit and opportunity of hearing.
A GST demand based on mismatch between GSTR-3B and auto-populated GSTR-2A was conditionally set aside because the assessee had not effectively participated in the proceedings. The Court accepted that the assessee should be heard on merits, but only on terms: 10% of the disputed tax demand had to be remitted within three weeks, after which a reply to the show cause notice could be filed and a personal hearing granted before fresh adjudication. The matter was therefore remitted for reconsideration with reasonable opportunity of hearing.
Issues: Whether the impugned GST demand order was liable to be set aside for want of a reasonable opportunity and whether the matter should be remitted for fresh consideration on payment of 10% of the disputed tax demand.
Analysis: The order recorded that the demand arose from a mismatch between the GSTR 3B return and the auto-populated GSTR 2A and that the assessee had not replied to the show cause notice or participated in the proceedings. At the same time, the Court accepted the assessee's plea that an opportunity should be granted to contest the demand on merits, but only by placing the assessee on terms. The Court therefore required remittance of 10% of the disputed tax demand within three weeks, permitted a reply to the show cause notice, and directed the authority to afford a reasonable opportunity, including personal hearing, before passing a fresh order.
Conclusion: The impugned order was set aside conditionally and the matter was remitted for fresh adjudication after compliance with the deposit condition and grant of opportunity of hearing.
Final Conclusion: The assessee obtained conditional relief against the demand order, but the dispute was sent back for reconsideration instead of being finally decided on merits.
Ratio Decidendi: Where a tax demand has been passed without effective participation by the assessee, the order may be set aside and the matter remitted with a condition for deposit, while ensuring a reasonable opportunity and personal hearing before fresh adjudication.
TaxTMI 
AI Drafter ✕
TaxTMI 
