Madras HC Grants Chance to Contest GST Case with 10% Pre-Deposit

Tvl.Jeyaprakash Vs Deputy State Tax Officer-2 (Madras High Court)

In the case of Tvl. Jeyaprakash Vs Deputy State Tax Officer-2, the Madras High Court has provided the petitioner an opportunity to contest a GST assessment order by depositing 10% of the disputed amount. The petitioner challenged the order dated 14.12.2023, which included a demand for significant amounts in IGST, CGST, and SGST along with penalties and interest. The court acknowledged that the petitioner, a small-time operator, failed to respond to show cause notices and personal hearing notices due to oversight. Despite objections that the petition was time-barred, the court decided to quash the impugned order and remand the case for fresh consideration, provided the petitioner deposits the required 10% of the disputed tax. The case will be reassessed, allowing the petitioner a chance to present their case within 30 days of the order receipt, with a final decision expected within three months.

 FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

This Writ Petition is disposed of at the time of admission after hearing the learned counsel for the petitioner and learned Additional Government Pleader for the respondent.

2. The petitioner is aggrieved by the impugned order dated 14.12.2023 issued by the respondent bearing reference in GST No.33AFVPJ1086K1Z1 the assessment year 2017-18.

3. By the impugned order the respondent has confirmed the following demand:

4. It is the case of the petitioner that the petitioner is a small time operator and therefore, failed to notice that the show cause notices in ASMT 10 dated 17.10.2022, DRC 01A dated 11.07.2023 and DRC 01 dated 19.08.2023, which were posted in the GST common portal.

5. It is the case of the petitioner that the petitioner has also failed to notice the three personal hearing notices dated 26.09.2023, 30.10.2023 and 16.11.2023 and submits the petitioner may be given one opportunity to explain the case.

6. The above submission is opposed by the learned Additional Government Pleader for the respondent, on the ground that the Writ Petition is hopelessly time barred and therefore, liable to be dismissed, on account of latches, in the light of the decision of the Hon’ble Supreme Court in the case of Assistant Commissioner (CT) LTU, Kakinada and others vs. Glaxo Smith Kline Consumer Health Care Limited reported in 2020 SCC Online SC 440.

7. It is submitted that the appellate remedy is also time barred in terms of limitation under Section 107 of the TNGST Act, 2017, as held by the Hon’ble Supreme Court in the case of Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others reported in (2008) 3 SCC 70 and submitted that this Writ Petition is liable to be dismissed.

8. Having considered the learned counsel for the petitioner and the learned Additional Government Pleader for the respondent, this Court is of the view that the petitioner may be given partial relief by quashing the impugned order and remitting the case back to the respondent to pass fresh orders subject to the petitioner depositing 10% of disputed tax to the credit of the respondent from its Electronic Cash Register.

9. The impugned order, which stands quashed, shall be treated as addendum to the show cause notice that preceded the impugned order.

10. It is expected that the petitioner shall file a reply within a period of 30 days from the date of receipt of a copy of this order together with above deposit. The respondent shall, thereafter, pass fresh orders on merits and in accordance with law as expeditiously as possible preferably within a period of three months, subject to the above deposit. Needless to state, the petitioner shall be heard before passing the order.

This Writ Petition is allowed, with above directions. No costs. Consequently, connected miscellaneous petitions are closed.