Prakash Contractor Vs DCIT (Madras High Court)
Summary: The Madras High Court set aside a GST assessment order dated 11.06.2025 against Prakash Contractor and remanded the matter for reconsideration because the petitioner’s reply and supporting documents were not taken into account by the assessing authority. The dispute related to the tax period April 2021 to March 2022 and concerned an alleged mismatch between the petitioner’s GSTR-3B returns and deductions made in respect of supplies under GSTR-7. The petitioner challenged the order in FORM GST DRC-07 bearing Reference No. ZD3306251066499 dated 11.06.2025 along with the detailed assessment order.
The petitioner submitted that, in response to the show cause notice, copies of the relevant GSTR-3B returns and details of TDS and TCS credit received during the relevant period had been enclosed. These documents, according to the petitioner, were not considered while passing the impugned order. The Court examined the reply on record and found that it specifically indicated that documents had been uploaded along with the reply, including the GSTR-3B returns and TDS/TCS credit details. In contrast, the impugned assessment order recorded that no reply had been submitted. This factual inconsistency persuaded the Court that reconsideration of the assessment was necessary.
The petitioner had, however, approached the High Court after expiry of the statutory period for filing an appeal. Without prejudice to its contentions, the petitioner therefore agreed to remit 10% of the tax demand under the impugned order as a condition for remand. The Court accepted this proposal and directed that the 10% amount be remitted within thirty days from receipt of a copy of the order. Subject to fulfilment of this condition, the impugned order was set aside and the matter remanded to the assessing authority.
The respondent was directed to provide a reasonable opportunity to the petitioner and issue a fresh order within five months from the date on which the petitioner remits 10% of the tax demand. The Court further directed that, subject to compliance with the deposit condition, any attachment of the petitioner’s bank account in relation to the impugned order would stand raised. The writ petition was accordingly disposed of, the connected miscellaneous petitions were closed and no order was made as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
An order dated 11.06.2025 is challenged primarily on the ground that the petitioner’s reply and documents annexed thereto were not taken into consideration.
2. Mr. R. Sethu Prabakaran, learned Government Advocate (Tax), accepts notice on behalf of the respondent.
3. Learned counsel for the petitioner submits that the confirmed tax demand pertains to the alleged mismatch between the petitioner’s GSTR 3B returns and deductions made in respect of supplies under GSTR 7. In response to the show cause notice, he submits that the petitioner had enclosed copies of the relevant GSTR 3B returns and the TDS and TCS credit received during the relevant period. He points out that these documents were not taken into account. Without prejudice, in view of the petitioner approaching this Court belatedly, learned counsel submits that the petitioner agrees to remit 10% of the tax demand under the impugned order as a condition for remand. An endorsement has been made on the bundle to that effect.
4. The petitioner’s reply is on record. Said reply indicates that documents were uploaded along with the reply. These documents included GSTR 3B returns and TDS and TCS credit received details. The impugned order records that no reply was submitted. Hence, re-consideration is necessary. Because the petitioner has approached this Court long after the statutory period for lodging an appeal expired, subject to the petitioner remitting 10% of the tax demand under the impugned order as a condition for remand, as agreed to, within thirty days from the date of receipt of a copy of this order, the impugned order is set aside and the matter is remanded for re-consideration. After providing a reasonable opportunity to the petitioner, a fresh order shall be issued within five months from the date of remittance of 10% of the tax demand by the petitioner. Subject to fulfilment of the above condition, the attachment, if any, of the bank account of the petitioner in relation to the impugned order shall stand raised.
5. The writ petition is disposed of on the above terms. Consequently, connected miscellaneous petitions are closed. There shall be no order as to costs.
