Raj Machine Tools Vs Assistant Commissioner (st) (fac) (Madras High Court)
The petitioner challenged two assessment orders relating to the same assessment period on multiple grounds. The principal contention was that the orders violated Section 73(2) of the applicable GST enactments, which, according to the petitioner, mandated a minimum interval of three months between the issuance of the show cause notice and the assessment order. Reliance was placed on the Bombay High Court’s decision in AM Market Places Private Limited v. The Union of India, particularly paragraphs 4 and 5 of that judgment. The petitioner also contended that the two impugned orders were mutually contradictory. One order proceeded on the basis that the petitioner had wrongly availed input tax credit (ITC) in respect of exempt supplies, whereas the other proceeded on the basis that the supplies were taxable and not exempt. Without prejudice to these contentions, the petitioner agreed to remit 25% of the disputed tax demand relating to one of the assessment orders, after adjustment of earlier recoveries, as a condition for remand.
The respondent submitted that Section 73(2) does not prescribe a mandatory three-month interval between the show cause notice and the adjudication order and also contended that the writ petitions had been filed belatedly.
