GST Demand Confirmed in absence of Reply of Assessee: Madras HC Remands Matter for Reconsideration on Condition of 10% Pre-deposit [Read Order]

The Madras High Court remanded the matter for reconsideration on the condition of a 10% pre-deposit after the Goods and Service Tax (GST) demand was confirmed in the absence of a reply from the assessee.

The petitioner asserts that he had entrusted compliances to a consultant. Since the show cause notice and impugned orders were uploaded in the “View Additional Notices and Orders” tab on the GST portal and not communicated to the petitioner through any other mode, it is stated that the petitioner was unaware of proceedings until recently.

Mr. N. Murali representing the petitioner submitted that the confirmed tax proposal pertains to a mismatch between the GSTR 3B return and the auto-populated GSTR 2A. If provided an opportunity, the petitioner would be in a position to establish that only eligible Input Tax Credit (ITC) was claimed. On instructions, learned counsel submits that the petitioner agrees to remit 10% of the disputed tax demand in respect of each assessment period as a condition for remand.

Mrs.K.Vasanthamala, representing the Government Advocate, accepts notice for the respondent. She submits that the impugned order was preceded by a notice in Form ASMT 10 and by a show cause notice. Therefore, she contends that principles of natural justice were complied with.

The bench evident that the tax proposal was confirmed because the petitioner did not file written objections or attend the personal hearing. By taking into account the assertion that the petitioner could not participate in proceedings on account of being unaware of the same, the interest of justice warrants that the petitioner be provided an opportunity to contest the tax demand on merits by putting the petitioner on terms.

Therefore, the Coram of Justice Senthilkumar Ramamoorthy noted that the impugned orders dated 10.07.2023 are set aside and the matters are remanded for reconsideration on condition that the petitioner remits 10% of the disputed tax demand in respect of each assessment period as agreed to. Such remittance shall be made within a period of 15 days from the date of receipt of a copy of this order. The petitioner is permitted to submit a reply to the respective show cause notice within the aforesaid period. Upon receipt of the petitioner's reply and upon being satisfied that 10% of the disputed tax demand in respect of each assessment period was received, the respondent is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and thereafter issue fresh orders within a period of three months from the date of receipt of the petitioner's reply.

These writ petitions are disposed of. Consequently, connected miscellaneous petitions were closed.

To Read the full text of the Order CLICK HERE

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