Tvl. Kajah Enterprises (P) Ltd. Vs Assistant Commissioner (Inspection) (ST-IU) (Madras High Court)
In a recent ruling, the Madras High Court has set aside an order issued by the Assistant Commissioner (Inspection) (ST-IU) that rejected a rectification application filed by Tvl. Kajah Enterprises (P) Ltd. The High Court found the rejection to be procedurally flawed, specifically highlighting the absence of stated reasons for the rejection and the denial of an opportunity for the petitioner to be heard. This decision underscores the judiciary’s consistent emphasis on adherence to principles of natural justice in administrative and quasi-judicial proceedings.
The case, heard by a single-judge bench, arose from Tvl. Kajah Enterprises’ challenge to an order dated March 28, 2025, which dismissed their rectification application concerning an assessment order for the financial year 2017-18, originally passed on January 6, 2025. The petitioner’s counsel, M/s. A. Lakshmi, argued that the rectification application was submitted within the stipulated time, yet the respondent authority rejected it without providing any reasons to explain why the assessment order did not contain an apparent error. Crucially, it was contended that this rejection occurred without granting the petitioner a hearing, thereby violating established legal norms.
Conversely, Mr. M. Lingadurai, the learned Special Government Pleader representing the respondent, presented a counter-argument. He asserted that it is not always necessary to attribute specific reasons when rejecting a rectification application. According to his submission, the authority’s primary task is to ascertain whether an “error apparent” exists on the face of the record based on the rectification request. If no such error is discernible, the authority is permitted to reject the application without detailing reasons. Furthermore, he argued that the proviso to Section 161 of the Central Goods and Services Tax (CGST) Act, which mandates an opportunity of hearing, applies only when the Assessing Officer initiates a suo motu rectification that would be detrimental to the assessee’s interests. Since the application in this instance was initiated by the assessee themselves, and they had not “indicated the error apparent” sufficiently for the Assessing Officer to exercise powers under Section 161, a personal hearing was deemed unnecessary.
