Tvl. B. S. Construction Vs State Tax Officer (Madras High Court)
Madras High Court held that order passed in violation of principles of natural justice since failure to respond to notice was due to the impression that response cannot be filed as GST registration is cancelled.
Facts- Petitioner submits that the respondent issued an ASMT-10 notice dated 03.07.2023, indicating a mismatch between the amounts in FORM 26AS and FORM GSTR-1, which comes to Rs.69 lakhs. This was followed by a show cause notice in FORM DRC-01, dated 15.09.2023. The petitioner was given a month’s time to respond to the show cause notice, with the due date being 14.10.2023. However, no specific date or time for personal hearing was mentioned in the show cause notice. While so, the petitioner’s GST registration was cancelled on 10.10.2023, with effect from 08.08.2023, leaving them to unable to respond to the show cause notice within the due date. Thereafter, the respondent passed the impugned order on 28.12.2023.
Conclusion- Held that the petitioner under the impression that they could not respond due to the registration being cancelled on 10.10.2023, failed to reply to the show cause notice. In the considered opinion of this court, the reason assigned by the petitioner appears to be genuine. Furthermore, the petitioner has settled the entire GST liability with no outstanding amount for Tamil Nadu. The show cause notice dated 15.09.2023 related to the turnover Pan India. Since the petitioner had already paid the required amount for Tamil Nadu, there is no additional liability for them. In such circumstances, this court finds that the petitioner’s failure to respond to the notice seems to be genuine. Therefore, the order passed by respondent without giving opportunity to the petitioner to submit their reply to the show cause notice, is arbitrary and in violation of the principles of natural justice and is liable to be set aside.
