The Madras High Court has demanded to make pre-deposit 25% for granting hearing opportunity on challenging the contested GST ( Goods and Services Tax ) demand order alleging excess GST Input Tax Credit ( ITC ) claim on account of non-reconciliation of the information.
The petitioner, a business engaged in electricity generation through windmills, supplies power to its customers through the Tamil Nadu Electricity Board. During a routine scrutiny of the petitioner’s annual GST return, excess ITC was found, arising from the non-reconciliation of certain information.
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This piloted to the issuance of a Show Cause Notice (SCN), and the subsequent impugned order confirmed the excess ITC claim.
The petitioner, M/s.Saks Power Private Limited, contended that both the SCN and the assessment order were not physically served to them through tender or registered post but were instead uploaded on the common GST portal.
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As a result, the petitioner claimed that they were unable to access the portal and therefore could not participate in the adjudication proceedings. The counsel representing the petitioner further submitted that, if granted an opportunity, the petitioner would be able to explain the discrepancies and clarify the issues at hand.
The petitioner relied on judgment by the Madras High Court in the case of M/s. K. Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise, which was favorable to such circumstances.
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The petitioner also expressed their willingness to pay 25% of the disputed tax amount and requested a final opportunity to present their objections before the adjudicating authority.
The Additional Government Pleader, representing the respondents, did not object to this request.
Consequently, Justice Mohammed Shaffiq set aside the impugned order, directing the petitioner to deposit 25% of the disputed tax amount within four weeks.
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After making such compliance, the court stated that the impugned order would be treated as a show cause notice, and the petitioner would be allowed to submit objections and supporting documents within an additional four weeks. The authorities were instructed to consider these objections and pass appropriate orders after granting a reasonable hearing.
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