Prema Sadanandan Anand Vs Assistant State Tax Officer (Kerala High Court)
The petitioner, a taxpayer registered under the Central Goods and Services Tax Act, 2017 and the Kerala State Goods and Services Tax Act, 2017, filed a writ petition challenging a recovery notice issued for realization of tax arrears along with interest and penalty for the assessment year 2019–20. The recovery notice demanded payment of ₹2,45,819/-. The petitioner contended that the admitted tax liability had already been paid prior to the assessment order, and this fact was also reflected in the assessment order itself. However, despite payment of the tax, the recovery notice was issued.
The petitioner also argued that the assessment order had not been served on her and that she became aware of it only upon receiving the recovery notice. According to the petitioner, due to the absence of proper service, she could not challenge the assessment order through the statutory appellate remedy, as the time limit for filing an appeal had already expired. The petitioner further contended that because the assessment order was not communicated to her, she lost the opportunity to settle the dispute under the Amnesty Scheme introduced by the Government in 2024.
Upon examining the recovery notice, the court observed that although the notice described the amount as arrears of tax, the figure mentioned actually corresponded to the interest and penalty payable by the petitioner. This was evident from the assessment order, which specifically recorded ₹2,45,819 as the amount payable towards interest and penalty. Therefore, the court held that the recovery notice did not warrant interference, as the discrepancy related only to the description of the amount and did not affect the petitioner’s liability.
The court further noted that the liability relating to interest and penalty had become final because the assessment order had not been challenged. Addressing the petitioner’s contention that the assessment order had not been served, the court observed that the order had been uploaded on the GST portal. According to the court, uploading the order on the web portal constitutes valid service under Section 169 of the CGST Act. The court also noted that this position had been settled by a Division Bench of the same High Court.
With respect to the petitioner’s claim that she was denied the opportunity to avail the Amnesty Scheme, the court held that the scheme had been widely publicized by the Government. It further observed that no provision required the authorities to issue a specific notice to individual defaulters regarding the scheme. Therefore, this contention was also rejected.
Although the court rejected the petitioner’s challenges to the recovery notice, it considered the request made by the petitioner for some time to clear the liability due to financial constraints. In the interest of justice, the court granted the petitioner three months to make the payment demanded in the recovery notice. The respondents were directed to keep further recovery proceedings in abeyance during this period, subject to the petitioner making payment within three months from the date of receipt of the judgment.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The petitioner is a tax payer registered under the provisions of the Central Goods and Services Tax Act, 2017, and the Kerala State Goods and Services Tax, 2017. The grievance highlighted by the petitioner in this writ petition is against Ext.P5 notice of recovery issued to the petitioner for realizing the tax arrears along with interest and penalty payable in respect of the assessment year 201920. Exhibit P3 is the order of assessment, and according to the petitioner, even before the said order, the admitted tax was paid. The fact that the petitioner had paid the tax is also evident from Ext.P3 order of assessment. However, the case of the petitioner is that despite the payment of tax, Ext.P5 demand has been issued, requiring the petitioner to pay Rs. 2,45,819/-.
2. Apart from the above, the petitioner has also raised a contention that, Ext.P3 order was not served upon the petitioner, and hence the petitioner was not aware of the same, until Ext.P5 demand notice was issued. Now the petitioner has lost the opportunity to challenge Ext.P3 by invoking the statutory remedy, as the time fixed for filing the appeal has expired, since the Ext.P3 order was passed on 09.08.2024. The challenge is raised in this writ petition against Ext.P5 in those circumstances. It is also the case of the petitioner that, as Ext.P3 was not served upon the petitioner, he could not avail the opportunity to settle the dispute by the Amnesty Scheme introduced by the Government in the year 2024.
3. I have heard Sri. Bharat Mohan, learned counsel for the petitioner, and the learned Government Pleader for the respondents.
4. On carefully going through the contents of Ext.P5, it is seen that, even though the amount is described as arrears of tax in the said notice, on going through the figure of the amount noted in Ext.P5, it is discernible that the said amount is in fact the interest and penalty payable by the petitioner. The said fact is evident from Ext.P3 order of assessment, where the details of the amounts in arrears are specifically mentioned and the exact figure, i.e. Rs. 2,45,819/-, is specifically referred to in Ext.P3, as the amount payable towards interest and penalty. Therefore, Ext.P5 as such does not warrant any interference, and if at all there is any discrepancy, it is only in respect of the description of the amount, and this would not affect the liability of the petitioner. As far as the liability of the petitioner in respect of the interest and penalty as referred to above is concerned, by virtue of Ext.P3 order of assessment, the same has become final since no challenge has been raised. Of course, it is true that the petitioner has raised a contention that Ext.P3 was not properly communicated to the petitioner. However, it is an undisputed fact that Ext.P3 order was uploaded in the web portal, which is a sufficient complaint of service as contemplated under Section 169 of the CGST Act. The said position is settled by a Division Bench of this Court as well.
5. In such circumstances, the contention raised by the petitioner that the Ext P3 order was not properly served upon the petitioner also cannot be accepted. Similarly, the contention regarding the denial of opportunity to avail the Amnesty scheme also cannot be considered, in view of the fact that, the Government has given wide publicity to the same. It was for the petitioner to avail the benefit of the same, if she was interested in availing the same. No provision was brought to the notice of this court that insists that a notice of the Amnesty scheme should have been issued to the defaulter. In such circumstances, the said contention also cannot be accepted.
6. At this juncture, learned counsel for the petitioner sought a breathing time to settle the liability, highlighting financial constraints. After considering relevant aspects, even though I rejected all the other contentions with regard to the challenge against Ext.P5 for the interest of justice, some breathing time can be granted to the petitioner for making the payment as demanded in Ext.P5.
Accordingly, this writ petition is disposed of, directing the respondents to keep all further proceedings in abeyance based on Ext.P5, for a period of three months, subject to the condition that the petitioner shall make the payment as demanded in Ext.P5, within a period of three months from the date of receipt of a copy of this judgment.
