Case Law Details
Tvl. Muralikrishna Infracon Bangalore Private Limited Vs Commissioner of Commercial Taxes (Madras High Court)
The writ petition before the Madras High Court challenged an assessment order dated 30.12.2023 passed under Section 73 of the TNGST Act. The assessment order was issued after the tax authorities identified a mismatch between the input tax credit claimed by the petitioner and the details uploaded on the GST portal. Based on this discrepancy, the respondent authority determined the disputed tax liability.
The petitioner contended that the transaction in question was genuine and that the mismatch occurred because the seller had failed to upload the relevant invoice details on the portal. It was argued that the petitioner should not be held liable for the seller’s omission. The petitioner also submitted that during the relevant period there were difficulties in operating the portal, which resulted in the petitioner not properly participating in the enquiry conducted by the authorities. The petitioner requested that an opportunity be granted to present the necessary documents and cooperate with the respondent authority.
The Court considered the nature of the transaction, the petitioner’s explanation for not effectively participating in the earlier enquiry, and the fact that the transaction occurred during the first year of the TNGST regime. Taking these factors into account, the Court was inclined to grant the petitioner one opportunity.
During the hearing, the respondents submitted that in similar cases courts generally direct a deposit of 25% of the tax liability. However, the petitioner’s counsel informed the Court that approximately 15% of the TNGST liability and 16% of the CGST liability had already been realized.
Considering this submission, the Court directed the petitioner to deposit an additional 10% of the disputed tax liability. Subject to this condition, the Court set aside the impugned assessment order dated 30.12.2023.
The matter was remanded to the second respondent for fresh assessment. The petitioner was directed to cooperate in the enquiry, produce relevant documents, and raise all available contentions. The authorities were instructed to complete the assessment proceedings afresh in accordance with law as expeditiously as possible. No costs were awarded, and the connected miscellaneous petition was closed.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This writ petition is filed challenging the impugned order dated 30.12.2023. The impugned order is an assessment made under Section 73 of the TNGST Act.
2. Upon finding that there is a mismatch between the input credit availed by the petitioner and the details uploaded in the portal, the impugned order of assessment was passed.
3. The contention of the petitioner is that the transaction is genuine, but however the seller has failed and omitted to upload the relevant invoice. For the default on the part of the seller, the liability cannot be mulcted on the petitioner. Moreover, at the relevant point of time, there was a problem faced by the petitioner in working on the portal properly, if an opportunity is given to the petitioner, he will cooperate with the respondent authority.
4. Considering the nature of transaction pleaded, the circumstances under which the petitioner submits that he did not properly participate in the enquiry and the transaction being in the first year of TNGST regime, I am inclined to accept the case of the learned counsel for the petitioner and grant him one opportunity.
5. The learned Additional Government Pleader appearing for the respondents would submit that in similar matters 25% of the tax liability is directed to be deposited. In this case, the learned counsel for the petitioner submits that already 15% in case of TNGST and 16% in case of CGST has been realized from the petitioner.
6. In view the said fact, the petitioner can deposit another 10% of the tax liability upon which, an opportunity can be granted to him.
7. In view thereof, this writ petition is disposed of on the following terms:
(i) The impugned order dated 30.12.2023 is set aside on the condition that the petitioner deposits 10% of the disputed tax determined by the impugned order.
(ii) The matter is remanded back to the file of the second respondent. The petitioner shall cooperate for further enquiry and produce such documents for his claim and raised all contentions, and the assessment proceedings shall be completed afresh in accordance with law as expeditiously as possible. No costs. Consequently, connected miscellaneous petition is closed.
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