GST Assessment Order cannot be Passed without Providing Opportunity to Reply and Hearing: Madras HC [Read Order]
The court held that the contested order was passed without following the due process of law and thus violated the principles of natural justice.
madras High Court – Madras HC – GST – Goods and Services Tax – GST Assessment – GST Assessment Order – TAXSCAN
madras High Court – Madras HC – GST – Goods and Services Tax – GST Assessment – GST Assessment Order – TAXSCAN
In a recent ruling, the Madras High Court ruled that the authorities must provide an opportunity to offer reply and hearing before issuing a GST ( Goods and Services Tax ) assessment order. The court viewed that the order was passed without complying with the principles of natural justice.
The bench of Justice krishnan Ramasamy stated that “this Court is of the view that the impugned order came to be passed, without affording opportunity of filing a reply to the show cause notice, including a personal hearing to the Petitioner to establish their case, thereby violating the principles of natural justice and hence, it is just and necessary to provide an opportunity to the Petitioner to establish their case, on merits and in accordance with law, however, by putting the Petitioner on terms.”
Chellamani and Co., a petitioner company engaged in the home appliances business, faced allegations of Input Tax Credit ( ITC ) mismatch. The company received a show-cause notice dated August 11, 2023, followed by another notice on September 26, 2023, and a reminder on November 8, 2023.
Get a Copy of GST ITC Draft Replies & Internal Controls [New Edition – 2nd Edn 2024] Click here
Due to medical conditions, the partner of the petitioner firm was unable to file a timely reply or appear for a personal hearing, although they had the relevant documents. Consequently, the authorities issued an impugned order dated December 25, 2023, demanding tax with penalties and interest, stating the petitioner failed to respond to the show-cause notices or appear in person.
The petitioner contended that the assessment order was issued without being afforded an opportunity to file a reply or attend a personal hearing, thus violating the principles of natural justice. The petitioner approached the court to challenge the order. The court held that the contested order was passed without following the due process of law and thus violated the principles of natural justice. It was deemed necessary to grant the petitioner a fair opportunity to present their case on merits and in accordance with the law on terms. The matter was remitted back to the The Deputy Commercial Tax Office for fresh consideration on 10% pre-deposit condition.
To Read the full text of the Order CLICK HERE
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