Hind Aluminium Company Vs State Tax Officer (Madras High Court)
The petitioner challenged an order dated 19.02.2025 confirming demand under Defect No.3, relating to E-way bill verification compared with GSTR-1. The petitioner contended that there were computational errors in the figures used to confirm the demand and that the proposal to drop demand under Defect No.4 had not been considered. The petitioner had replied to the Show Cause Notice issued in Form DRC-01 on 19.08.2024 through a reply dated 01.10.2024, but was not given an opportunity to present the case in person. Although a further reply was submitted, the petitioner did not appear personally, and the impugned order was passed confirming the demand under Defect No.3.
The respondent’s observation stated that the reply was examined but not supported by documentary evidence explaining the difference between the E-way bill and GSTR-1 details. Consequently, tax, interest under Section 50, and penalty under Section 74 were determined for 2019-20, amounting to a total of ₹77,67,538.
The Court held that the petitioner had established a prima facie case regarding Defect No.3. However, since no appeal had been filed earlier, the matter was remanded on the condition that the petitioner deposit 10% of the disputed tax within four weeks. Upon such deposit, the respondent must fix a date for personal hearing, allow the petitioner to explain the case afresh, and permit written submissions if desired. A final order must be passed within three months of the petitioner’s reply or pre-deposit. If the petitioner fails to comply, the respondent may proceed with recovery as if the writ petition had been dismissed. The direction to deposit 10% applies only to the impugned order concerning Defect No.3. The writ petition was disposed of without costs.
