Tvl. Jainsons Castors and Industrial Products Vs Assistant Commissioner (ST) (Madras High Court)
The Madras High Court recently set aside a GST assessment order against Tvl. Jainsons Castors and Industrial Products for the assessment year 2017-18. The petitioner, a supplier of trailers, semi-trailers, and other vehicles registered under the GST Act, 2017, had filed returns and paid taxes for the relevant period. However, discrepancies were found between the petitioner’s GSTR 3B and GSTR 2A returns during scrutiny.
Consequently, a notice in DRC-01 was issued, followed by reminders and offers for personal hearings. Despite these opportunities, the petitioner neither filed a reply nor attended any hearings. The petitioner’s counsel argued that they were unaware of the proceedings as the show cause notices and the assessment order were uploaded to the GST portal but not served directly via tender or Registered Post with Acknowledgement Due (RPAD). This lack of proper service, the petitioner contended, prevented them from participating in the adjudication process.
Relying on a recent judgment in M/s. K.Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise, the petitioner’s counsel submitted that similar cases had been remanded back for reconsideration upon payment of 25% of the disputed tax. The petitioner expressed willingness to pay this amount and requested a final opportunity to present their objections to the proposed assessment. The petitioner also requested that the 10% pre-deposit made during a subsequent appeal be adjusted towards the 25% payment. The respondent’s counsel did not object to this request.
The High Court, with the consent of both parties, disposed of the writ petition with specific conditions. The impugned assessment order was set aside. The petitioner was directed to deposit 25% of the disputed taxes within four weeks of receiving a copy of the order. Any amounts already recovered or paid, including the appeal pre-deposit, will be adjusted towards this 25% payment. The assessing authority was directed to inform the petitioner of any remaining balance due within one week of receiving the court order, with the petitioner then having three weeks to pay the balance. Failure to comply with the 25% payment within the four-week deadline would result in the reinstatement of the original assessment order. Any bank account attachments or garnishee proceedings would be lifted upon compliance with the payment condition.
Upon fulfilling the 25% payment condition, the set-aside assessment order would be treated as a show cause notice. The petitioner would then have four weeks to submit their objections along with supporting documents. The respondent was directed to consider these objections and pass a fresh order in accordance with the law, after granting the petitioner a reasonable opportunity for a hearing. Failure to either comply with the 25% payment or file objections within the stipulated four-week periods would result in the automatic restoration of the original assessment order. No order was made as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
