Ex parte GST assessment set aside for want of effective hearing, with matter remanded for fresh adjudication.

An ex parte GST assessment was set aside because the assessee had not been given an effective opportunity to place its reply and supporting documents on record. The court accepted the explanation for non-participation, noted the disputes regarding input tax credit mismatch, ineligible input tax credit, late filing, penalty and interest, and held that fresh adjudication was necessary to ensure a fair hearing. Although relief is ordinarily linked to deposit of 25% of the disputed tax, 35% of the demand had already been recovered, so no further condition was imposed. The bank account attachment issued pursuant to the assessment was also raised.

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Issues: Whether an ex parte GST assessment order, passed without effective participation of the assessee, should be set aside and remanded to enable the assessee to file reply and supporting documents.

Analysis: The assessment was made ex parte because the assessee did not avail the opportunities provided. The Court took note of the explanation regarding the alleged input tax credit mismatch, ineligible input tax credit, late filing of return, and the levy of penalty and interest. Considering the nature of the discrepancies and the explanation offered for non-participation, the Court held that the assessee should be afforded an opportunity to place materials before the assessing officer. The Court also noted that, although such relief is ordinarily conditioned on deposit of 25% of the disputed tax, 35% of the demand had already been recovered and no further condition was warranted.

Conclusion: The ex parte assessment order was set aside and the matter was remanded for fresh adjudication after giving the assessee an opportunity to submit reply and documents. The bank account attachment passed pursuant to the assessment was also raised.

Ratio Decidendi: Where an assessment is rendered ex parte and the assessee shows sufficient cause for non-participation, the order may be set aside and remanded to secure a fair opportunity of hearing before fresh adjudication.

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