In a recent ruling, the Madras High Court set aside a goods and services tax (GST) assessment due to order procedural lapses in an input tax credit (ITC) dispute.
In this case, the petitioner had challenged the impugned order, stating that the petitioner was not aware of the initiated proceedings because the notices and orders were uploaded under the GST Portal “view additional notices and orders” tab without ensuring proper communication for the 2018-19 assessment year.
The Future of Tax and Finance: Upskill with Us
The counsel on behalf of the petitioner contended that due to the above-mentioned lapse, the petitioner was unaware of the proceedings, which in the end prevented the petitioner from responding to a show-cause notice issued in October 2023 or attending the personal hearing scheduled in November 2023. Consequently, the respondent authorities passed the assessment order confirming excess ITC claims, leaving the petitioner unable to present their case.
The counsel on behalf of the petitioner requested an opportunity so that the petitioner could address the discrepancies in the ITC claim.Thecounsel also stated that the petitioner was ready to deposit 25% of the disputed tax to demonstrate good faith.
The Future of Tax and Finance: Upskill with Us
The bench accepted the above-mentioned submission made by the petitioner and quashed the impugned assessment order, and directed the petitioner to deposit 25% of the disputed tax within four weeks.
The Madras High Court, composed of Justice Mohammed Shaffiq, directed the department to treat the assessment order as a fresh show-cause notice, permitting the petitioner to file objections and supporting materials within four weeks of payment. The respondents were ordered to consider the objections and pass a reasoned order after granting a hearing.
The Future of Tax and Finance: Upskill with Us
The bench further held that the failure to comply with the above mentioned time frame would result in the restoration of the original assessment order.
The petitioner was represented by Mr.A.N.R.Jayaprathap and the respondent by Mr. V.Prashanth Kiran.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates
