Case Law Details
Tvl. Rajendran Karthikeyan Vs Assistant Commissioner (ST)(FAC) (Madras High Court)
Madras High Court set aside the GST assessment order against Tvl. Rajendran Karthikeyan for the financial year 2018-19. The case arose due to a mismatch between the petitioner’s GSTR-3B and GSTR-2A/2B filings. Despite being issued a show cause notice and offered a personal hearing, the petitioner failed to respond, leading to the confirmation of the tax demand. During the proceedings, the petitioner cited a prior ruling and sought a chance to present objections, offering to deposit 25% of the disputed tax. The respondent’s counsel did not oppose the adjustment of previously recovered amounts against this deposit.
The court ruled that the petitioner must pay 25% of the disputed taxes within four weeks, adjusting any prior recoveries. If this condition is met, the impugned order will be treated as a show cause notice, allowing the petitioner four additional weeks to submit objections. Failure to comply would result in the restoration of the assessment order. Additionally, any bank account attachments or garnishee proceedings would be withdrawn upon payment compliance. The court directed that the entire verification and payment process be completed within four weeks and disposed of the petition accordingly.
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 17.04.2024 relating to the assessment year 2018-19.
2. The petitioner is a registered dealer under Goods and Services Act, 2017. During the relevant period, the petitioner had filed its return and paid appropriate taxes. However, on verification of the monthly returns, it was found that there was mismatch between GSTR 3B and GSTR2A/2B
2.1. Pursuant thereto, a show notice in DRC-01 was issued to the petitioner on 31.08.2023. Further, personal hearing was offered on 08.09.2023. However, the petitioner had neither filed its reply nor availed the opportunity of personal hearing. Hence, the impugned order came to be passed, confirming the proposal.
3. The learned counsel for the petitioner would 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 he may be granted one final opportunity before the adjudicating authority to put forth their objections to the proposal. It is further submitted that subsequent to the passing of the impugned order, more than Rs.1,00,000/- has been recovered and his only request is that the same may be adjusted towards 25% of the disputed tax, to which the learned Additional Government Pleader appearing for the respondent does not have any serious objection, while seeking liberty to verify the correctness of the statement relating to remittance made by the petitioner.
4. By consent of parties, the writ petition stands disposed of on the following terms:
a) The impugned order dated 17.04.2024 is set aside
b) The petitioner shall deposit 25% of the disputed taxes as admitted by the learned counsel for the petitioner and the respondent, within a period of four weeks from the date of receipt of a copy of this order.
c) If any amount has been recovered or paid out of the disputed taxes, including by way of pre-deposit in appeal, the same would be reduced/adjusted, from/towards the 25% of disputed taxes directed to be paid. The assessing authority shall then intimate the balance amount out of 25 % of disputed taxes to be paid, if any, within a period of one week from the date of receipt of a copy of this order. The petitioner shall deposit such remaining sum within a period of three weeks from such intimation.
d) The entire exercise of verification of payment, if any, intimation of the balance sums, if any, to be paid for compliance with the direction of payment of 25% of the disputed taxes, after deducting the sums already paid and payment by the petitioner of the balance amount, if any, on intimation in compliance of the above direction, shall be completed within a period of four weeks from the date of receipt of copy of this order.
e) Failure to comply with the above condition viz., payment of 25% of disputed taxes within the stipulated period i.e., four weeks from the date of receipt of a copy of this order shall result in restoration of the impugned order.
f) If there is any recovery by way of attachment of Bank account or garnishee proceedings, the same shall be lifted /withdrawn on complying with the above condition viz., payment of 25 % of the disputed taxes.
g) 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. It is made clear that if the above conditions viz., 25% of disputed taxes is not complied or objections are not filed within the stipulated period, four weeks respectively from the date of receipt of a copy of this order, the impugned order of assessment shall stand restored.
5. There shall be no order as to costs. Consequently, connected miscellaneous petitions are closed.
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