GST Portal Notice Insufficient, Assessee gets relief from Madras HC [Read Order]
Uploading notices on the GST portal alone is insufficient, the Madras HC set aside the tax demand order.
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The Madras High Court has ruled that uploading notices solely on the GST portal is insufficient service, while providing relief to an assessee who was unaware of the proceedings against him. The petitioner Chokalingam Srinivasan, was running a business of undertaking works contract services and was registered under the Goods and Services Tax Act, 2017(GST Act, 2017). For the 2018-19 tax...
The Madras High Court has ruled that uploading notices solely on the GST portal is insufficient service, while providing relief to an assessee who was unaware of the proceedings against him.
The petitioner Chokalingam Srinivasan, was running a business of undertaking works contract services and was registered under the Goods and Services Tax Act, 2017(GST Act, 2017). For the 2018-19 tax year, the petitioner submitted their tax filings and paid the required taxes.
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However, an audit of these filings revealed some discrepancies between GSTR-3B and Form 26AS of the Income Tax; Form GSTR-3B and GSTR9/9C and proceedings were initiated against the petitioner under Section 61 of the Tamil Nadu Goods and Services Tax Act, 2017 (TNGST Act,2017).
The petitioner, represented by S.Ramanan, argued that the notices and orders were not served through registered post or personal delivery. Instead, they were uploaded on the GST portal, making the petitioner unaware of the proceedings. As a result, the petitioner could not participate in the adjudication process. The petitioner argued that if given an opportunity, they would be able to explain the alleged discrepancies.
The petitioner’s counsel relied on a recent judgment in M/s. K. Balakrishnan, Balu Cables v. Assistant Commissioner of GST & Central Excise (2024) where the court remanded the matter under similar circumstances, subject to the payment of 25% of the disputed taxes.
Additionally, the petitioner pointed out that recovery proceedings had already been initiated, leading to the attachment of their bank account. Given these circumstances, the petitioner expressed willingness to deposit 25% of the disputed tax and sought one final opportunity to present their objections before the adjudicating authority.
The government counsel, K. Vasanthamala, appearing for the respondents, did not raise any serious objection to this request.
The court, presided over by Justice Mohammed Shaffiq, resolved the dispute by conditionally setting aside the order, based on mutual consent. The court directed the petitioner to deposit 25% of the disputed taxes within four weeks of receiving the order, with any prior payments being credited.
The tax department was instructed to verify the payments and inform the assessee of any remaining balance. The court clarified that failure to comply would lead to the restoration of the assessment order. Upon compliance, the withdrawal of the bank account attachment and garnishee proceedings was mandated.
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Additionally, the court treated the impugned order as a show cause notice and required the assessee to submit objections within four weeks. In the event of filing objections, the tax authority was instructed to consider them and grant a fair hearing before passing a fresh order. With these directions, the court disposed of the petition.
To Read the full text of the Order CLICK HERE
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