GST Liability of 8.3L Confirmed on alleged Misconception of Intra and Inter State Sales : Madras HC remands for Reconsideration on Pre-deposit [Read Order]

In a recent ruling, the Madras High Court directed reconsideration of the matter with respect to the Goods and Services Tax ( GST ) liability of Rs. 8.3L confirmed on misconception of Intra and Inter state sales on Rs. 3 lakhs pre-deposit condition.

The crux of the petitioner's argument rested on documentary evidence, specifically referencing Form-I, Form-WW, and their annexure. According to the petitioner's counsel, these documents clearly demonstrated that only intra-state sales had been conducted. Seeking to contest the tax demand on its merits, the petitioner offered to remit a sum of Rs.3,00,000/- as a condition for remand.

Responding to the petitioner's plea, Mr. V. Prashanth Kiran, Government Advocate (Tax), raised a procedural objection. He argued that the writ petition was susceptible to rejection due to its belated filing, given the date of the impugned order. However, upon scrutiny of the impugned order, it became apparent that the tax liability was founded on the misconception of inter-state sales, resulting in an erroneous tax assessment of Rs.8,43,100/-.

Examining the petitioner's submission and the evident error in assessment, a Single bench of Justice Senthilkumar Ramamoorthy exercised its discretion to set aside the impugned order and remanded the matter for reconsideration. This decision is contingent upon the petitioner remitting the specified sum within three weeks and submitting a reply to the show-cause notice within the same period.

Additionally, the Court directed the respondent to afford the petitioner a reasonable opportunity, including a personal hearing, and to issue a fresh order within three months from the date of receipt of the remittance.

The Madras High Court clarified that the deposit of Rs.3 lakhs was subject to the outcome of the remanded proceedings, ensuring fairness in the process. Consequently, the writ petition was disposed of under the aforementioned terms, with no order as to costs.

To Read the full text of the Order CLICK HERE

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