Tvl. Kwatra Karteek Vs Assistant Commissioner (ST)(FAC) (Madras High Court)
Introduction: In a significant ruling, the Madras High Court set aside an order regarding GST liability due to non-payment under the Reverse Charge Mechanism (RCM). The case, Tvl. Kwatra Karteek Vs Assistant Commissioner (ST)(FAC), hinged on the breach of natural justice principles and the petitioner’s inadvertent error while filing Form GSTR 3B. This judgment underscores the importance of due process and fair hearing in tax assessments.
Detailed Analysis
The case stemmed from an original order dated December 28, 2023, which Tvl. Kwatra Karteek challenged, citing a breach of natural justice. The petitioner claimed unawareness of the proceedings leading to the order due to a lapse by their part-time accountant. This oversight resulted in the petitioner not receiving crucial information regarding the tax demand.
The crux of the issue was an alleged short payment of GST, attributed to an inadvertent error in filling Form GSTR 3B. The petitioner’s counsel argued that given an opportunity, they could prove no short payment occurred. The defense highlighted the procedural lapse, emphasizing that the impugned order was issued without adequate notice and opportunity for the petitioner to present their case.
The respondent, represented by Mr. V. Prasanth Kiran, noted that the order followed a show cause notice dated September 30, 2023. Despite this, the court found that the tax demand focused solely on non-payment under RCM, resulting from the petitioner’s filing error. This error could potentially be rectified if the petitioner was allowed to contest the demand on its merits.
