The Madras High Court has quashed the DCR-07 order issued by the Goods and Services Tax ( GST ) Authorities despite the petitioner/taxpayer’s request to extend reply time. The court observed that the authorities, without considering the request, issued the order.
The petitioner, a registered entity under applicable GST regulations, received intimation in Form GST DRC-01A on 27.01.2023, followed by a show cause notice dated 28.09.2023. Upon receiving the show cause notice, the petitioner promptly responded on 29.09.2023, requesting 30 days to compile necessary details from various sources. Despite this request, the impugned orders were issued on 16.10.2023.
Counsel for the petitioner argued that the orders were issued within approximately 15 days of receiving the petitioner’s reply, despite the request for additional time, and further noted that the reply was not acknowledged or addressed in the impugned orders.
V. Prashanth Kiran, representing the government, stated that personal hearing opportunities were provided subsequent to the show cause notices, contending that there was no basis for interference.
However, the court observed that the petitioner had replied to the show cause notices immediately and had requested additional time, which was not considered. The impugned orders were issued without addressing the petitioner’s reply or providing reasons for rejecting it, thus denying the petitioner of a fair opportunity to contest the tax demand, rendering the orders unsustainable.
The bench of Justice Senthilkumar Ramamoorthy observed that “Without responding to the petitioner’s reply, the impugned orders were issued within about 15 or 16 days from the date of receipt of the reply. The impugned orders do not refer to the petitioner’s reply or set out any reasons for rejecting the reply.”
Consequently, the bench quashed the impugned order and remanded the matters for reconsideration. The petitioner was granted 15 days from the receipt of the court’s order to submit a reply to the respective show cause notices. The respondent was also directed to afford the petitioner a reasonable opportunity, including a personal hearing, and issue fresh orders within two months from the receipt of the petitioner’s reply.
The writ petitions were disposed of with no order as to costs, and connected miscellaneous petitions were closed accordingly.
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