Case Law Details
Saks Power Private Limited Vs Deputy State Tax Officer (Madras High Court)
Madras High Court held that since petitioner failed to comply with notice issued in Form DRC-01, the matter will restore back to the file of AO provided petitioner deposits 25% of disputed tax amount.
Facts- The petitioner is engaged in the business of generation of electricity through its wind mills and supply to its customers through Tamil Nadu Electricity Board. During the relevant period, the petitioner filed its return and paid the appropriate taxes. However, during the scrutiny of the petitioner’s annual return, it was found that there was excess claim of ITC on account of non-reconciliation of information. Subsequently, a Show Cause Notice was issued to the petitioner in Form DRC-01 on 27.12.2023, followed by a reminder on 03.04.2024. Further, personal hearing was offered on 10.01.2024 and 08.04.2024. However, the petitioner had neither filed its reply nor availed the opportunity for a personal hearing. Hence, the impugned order came to be passed, confirming the proposal.
Conclusion- Held that the impugned order is set aside and the petitioner shall deposit 25% of the disputed tax within a period of four (4) weeks from the date of receipt of a copy of this order. On complying with the above condition, the impugned order of assessment shall be treated as show cause notice and the petitioner shall submit its objections within a period of four (4) weeks from the date of receipt of a copy of this order along with supporting documents/material. If any such objections are filed, the same shall be considered by the respondent and orders shall be passed in accordance with law after affording a reasonable opportunity of hearing to the petitioner. If the above deposit is not paid or objections are not filed within the stipulated period, i.e., four weeks and four weeks respectively from the date of receipt of a copy of this order, the impugned order of assessment shall stand restored.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
The present writ petition is filed challenging the impugned order passed by the respondent dated 26.04.2024 relating to the assessment year 2018-19.
2. The petitioner is engaged in the business of generation of electricity through its wind mills and supply to its customers through Tamil Nadu Electricity Board. During the relevant period, the petitioner filed its return and paid the appropriate taxes. However, during the scrutiny of the petitioner’s annual return, it was found that there was excess claim of ITC on account of non-reconciliation of information. Subsequently, a Show Cause Notice was issued to the petitioner in Form DRC-01 on 27.12.2023, followed by a reminder on 03.04.2024. Further, personal hearing was offered on 10.01.2024 and 08.04.2024. However, the petitioner had neither filed its reply nor availed the opportunity for a personal hearing. Hence, the impugned order came to be passed, confirming the proposal.
3. The impugned order is challenged on the premise that neither the show cause notices nor the impugned order of assessment have been served by tendering to the petitioner or by registered post, instead it was uploaded in the common portal. It was further submitted that the petitioner was unable to access the common portal and thus was unable to participate in the adjudication proceedings.
4. It is submitted by the learned counsel for the petitioner that if the petitioner is provided with an opportunity, they would be able to explain the alleged discrepancies. The learned counsel for the petitioner would then place reliance upon the recent judgment of this Court in the case of M/s. K. Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise in W.P.(MD)No.11924 of 2024 dated 10.06.2024. It was further submitted that the petitioner is ready and willing to pay 25% of the disputed tax and that they may be granted one final opportunity before the adjudicating authority to put forth their objections to the proposal, to which, the learned Additional Government Pleader appearing for the respondents does not have any serious objection.
5. In view thereof, the impugned order is set aside and the petitioner shall deposit 25% of the disputed tax within a period of four (4) weeks from the date of receipt of a copy of this order. On complying with the above condition, the impugned order of assessment shall be treated as show cause notice and the petitioner shall submit its objections within a period of four (4) weeks from the date of receipt of a copy of this order along with supporting documents/material. If any such objections are filed, the same shall be considered by the respondent and orders shall be passed in accordance with law after affording a reasonable opportunity of hearing to the petitioner. If the above deposit is not paid or objections are not filed within the stipulated period, i.e., four weeks and four weeks respectively from the date of receipt of a copy of this order, the impugned order of assessment shall stand restored.
6. Accordingly, the Writ Petition stands disposed of. There shall be no order as to costs. Consequently, connected miscellaneous petitions are closed.
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