The Madras High Court set aside the Goods and Services Tax ( GST ) orders for the assessment periods 2018-19 and 2019-20 due to the petitioner’s inability to participate in the proceedings on account of a mismatch between GSTR 3B returns and the auto-populated 2A.
The petitioner, M/s.Thiashola Plantation P. Ltd., challenged the original orders for the assessment periods 2018-19 and 2019-20 on the grounds that they were not provided a reasonable opportunity to contest the tax demand on its merits.
The writ petitions were filed based on the petitioner’s assertion that the show cause notice and the impugned order were not delivered by registered post or email. They claimed these documents were only uploaded on the GST portal.
Manoharan Sundaram, counsel for the petitioner, argued that the tax proposals arose from a mismatch between the GSTR 3B returns and auto-populated 2A. He further argued that the petitioner was denied the opportunity to participate in the proceedings because the show cause notice and the impugned orders were only uploaded on the GST portal, and not sent via registered post or email.
The counsel also noted that the order dated 16.10.2023 mentioned a personal hearing on 18.10.2023. On the other hand, V. Prashanth Kiran, the Government Advocate for the respondent, submitted that the first personal hearing was on 11.10.2023.
The court found that the tax proposal was confirmed because the petitioner did not reply to the show cause notice. The court also accepted the petitioner’s assertion that they could not participate due to being unaware of the proceedings, and the interest of justice warrants that the petitioner be provided an opportunity by putting the petitioner on terms.
The bench of Justice Senthilkumar Ramamoorthy set aside the impugned orders on the condition that the petitioner remits 10% of the disputed tax demand in respect of each assessment period within three weeks from the date of receipt of a copy of the order.
The petitioner was permitted to submit a reply to the show cause notice. The court directed the respondent to provide a reasonable opportunity to the petitioner, including a personal hearing, and issue fresh orders within three months from the date of receipt of the petitioner’s reply.
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