The Madras High Court, on the dispute of discrepancies were detected between the ITC availed in Table 4.A.(2) + 4.A.(3) of GSTR-3B and the tax liability declared in Table 3.1d of the same form, has directed to provide fresh hearing on pre-deposit.
The petitioner, a proprietor operating a medical shop registered under the GST Act, 2017, faced allegations of claiming excess Input Tax Credit ( ITC ) under the reverse charge mechanism in their GSTR-3B returns.
Complete Draft Replies of GST ITC Related Notices, Click Here
The issue arose when discrepancies were detected between the ITC availed in Table 4.A.(2) + 4.A.(3) of GSTR-3B and the tax liability declared in Table 3.1d of the same form. The GST authorities issued notices in Forms DRC-01A and DRC-01 through the GST portal, followed by multiple reminders and a personal hearing opportunity.
However, the petitioner neither filed a response nor appeared for the hearing, resulting in the immediate issuance of the impugned order.
The petitioner contested the order on the grounds of improper service, asserting that both the show-cause notice and the assessment order were only uploaded on the GST portal without direct service or dispatch via registered post.
Complete Draft Replies of GST ITC Related Notices, Click Here
The petitioner also claimed difficulty accessing the portal, which hindered participation in the proceedings. The petitioner requested another opportunity to explain the discrepancies and offered to deposit 25% of the disputed tax amount as a precondition for reassessment.
Justice Mohammed Shaffiq, considering these submissions and relying on its previous judgment in M/s. K. Balakrishnan, Balu Cables vs. Assistant Commissioner of GST & Central Excise, set aside the impugned order.
The court directed the petitioner to deposit 25% of the disputed tax and after complying that was to be treated as a show-cause notice. The GST authorities were instructed to adjudicate the matter afresh, after providing a fair hearing.
Mr.N.Ganesh and Mr.G.Nanmaran, Special Government Pleader appeared for the petitioner and the respondents respectively.
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