Reasonable opportunity in tax assessment led to remand after disputed GSTR 2A and GSTR 3B mismatch

An assessment based on the difference between auto-populated GSTR 2A and turnover reported in GSTR 3B may be interfered with where the assessee was not given a meaningful opportunity to contest the demand on merits. The Madras HC set aside the impugned order because the notice and related communications were not effectively brought to the petitioner's notice, and remanded the matter for fresh adjudication after reply, a personal hearing, and payment of 10% of the disputed demand as a condition for remand.

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Issues: Whether the impugned tax assessment order was liable to be set aside for want of a reasonable opportunity and whether the matter should be remanded for fresh adjudication after hearing the petitioner.

Analysis: The order imposed liability on the basis of the difference between the auto-populated GSTR 2A and the turnover reflected in GSTR 3B. The petitioner asserted that the notice and related communications were not effectively brought to its notice and sought an opportunity to place supporting material before the assessing officer. In the circumstances, the absence of a meaningful opportunity to contest the demand on merits warranted interference, while safeguarding the revenue interest by requiring part payment as a condition for remand.

Conclusion: The impugned order was set aside and the matter was remanded for fresh consideration after receipt of reply, payment of 10% of the disputed demand, and grant of a reasonable opportunity including personal hearing.

Final Conclusion: The assessment was reopened for fresh adjudication on merits, subject to compliance with the condition imposed by the Court.

Ratio Decidendi: An assessment order founded on disputed tax liability may be set aside and remanded where the assessee was not afforded a meaningful opportunity to contest the demand on merits.

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