Ex-Parte GST Order Not Final: Madras HC Grants Opportunity to Recontest after 50% Disputed Tax Payment Owing to Non-Participation [Read Order]
The Court instructed Respondent to consider Reply filed by Petitioner and Pass a Final Order within Three Months
The Madras High Court set aside the immediate enforcement of a GST demand raised for the 2020–21 period, granting conditional relief to petitioner after finding that the assessee had not responded to the earlier notice and order that relied on income-tax data reflected in Form 26AS.
The petition was filed by Nalatha Melbin Nadar, proprietor of Sharon Translink, challenging the order dated 30.09.2024 passed by the Deputy State Tax Officer-II, Muthialpet Assessment Circle. The petitioner, represented by G. Anisha, questioned the legality of the demand issued in Form DRC-07 and the preceding notice in Form DRC-01 dated 14.08.2023.
The petitioner contended that the services rendered were exempt under Notification No.12/2017–Central Tax (Rate) dated 28.06.2017, which exempts services of providing a vehicle on hire to a Goods Transport Agency (GTA). It was argued that the demand, which relied on Form 26AS entries relating to Tax Deduction at Source (TDS) under the Income Tax Act, 1961, was unsustainable and contrary to the provisions of the CentralGoods and Services Tax (CGST) Act, 2017.
Justice C. Saravanan, in his order, noted that the exemption claim could not be granted at this time since the petitioner had not replied to the show cause notice or the contested proceedings. Subject to depositing 50% of the disputed tax confirmed under the contested order, the Court allowed the petitioner to provide a thorough response. The deposit was instructed to be made in cash or via the electronic cash ledger within thirty days of receiving the order.
The first respondent, after complying with the payment condition, was directed to consider the reply and pass a final order on merits and in accordance with law within three months. The Court further ruled that the attachment of the petitioner's bank account will be automatically revoked upon submission of the pre-deposit and reply.
The writ petition was disposed stating that failure to comply with the conditions would entitle the authorities to proceed with recovery as if the writ petition had been dismissed Further, the connected miscellaneous petitions were also closed.
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