In a recent ruling, the Madras High Court allowed it to contest the order on 10% pre-deposit condition as agreed by the petitioner in the case of misplacement of Input Tax Credit ( ITC ) in GSTR – 3B. The court also observed the submission of the petitioner that he was not able to reply to notices as uploaded in the Additional Notices Tab.
A writ petition has been filed for the quashment of the Order in Form GST DRC-07, along with the detailed order issued by the first respondent – The Deputy State Tax Officer-. The petitioner sought a directive for the first respondent to provide an opportunity to respond to the Show Cause Notice dated September 22, 2023, in Form GST DRC-01.
The petitioner, Panjatcharam Kumaravel engaged in the business of procuring and distributing “Rich & Roy” sweets and snacks through M/s. Dhanalakshmi Agencies, holds a registered GSTIN under the Tamil Nadu Goods and Services Tax Act, 2017.
On March 4, 2024, the petitioner received a letter dated February 29, 2024, from the second respondent, intimating the non-payment of GST arrears pursuant to an assessment order. However, upon verification through the GST Portal, with the assistance of his GST compliance consultant, the petitioner found no trace of such a demand or pending proceedings.
The petitioner later discovered that notices and orders had been issued and uploaded by the first respondent on the GST Portal under the “View Additional Notices and Orders” tab. It included:
Additionally, on March 7, 2024, the petitioner received a letter from the third respondent Bank, marking a lien on his current account due to an attachment order from the Commercial Tax Department.
The petitioner contended that inadvertent errors were made while filing the GSTR-3B returns for the year 2017-18, where the ITC on inward supplies was mistakenly reported under the column for ITC on “Inward supplies liable to reverse charge.” The petitioner clarified that all supplies were procured from Rich Roy Sweets and Snacks and were not subject to reverse charge.
Ms. K. Vasanthamala, Government Advocate (Tax), submitted that the petitioner had been duly notified, with the intimation issued on September 15, 2023, and the show cause notice on September 22, 2023.
Further added that the petitioner being a registered person under the GST Regime, his plea for not having accessed the Portal for long period cannot be accepted as a valid reason and she would further submit that the petitioner be directed to avail the statutory remedy.
Upon reviewing the proceedings, the bench of Justice R. Kalaimathi noted that all relevant notices and orders were indeed issued and uploaded as stated. The redesigned dashboard of the GST Portal now clearly specifies different types of notices and orders.
Given the petitioner’s reasons, the court decided to afford the petitioner an opportunity to present his case. The impugned order was quashed on the condition that the petitioner pays 10% of the disputed tax demand for the assessment year 2017-18 within four weeks from the order’s receipt.
The Assessing Officer was instructed to reassess after providing a reasonable opportunity to the petitioner and to issue a fresh assessment order within six weeks from the receipt of this order.
The writ petition is disposed of on these terms and consequently, connected writ miscellaneous petitions are closed.
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