Tvl. M-S Global Choice Coco Products vs. The Deputy State Tax Officer Ii

Facts

The petitioner, Tvl. M-S Global Choice Coco Products, represented by its proprietor, filed a writ petition challenging an assessment order dated 18.12.2023, passed by the Deputy State Tax Officer II, Pudukkottai. The order was passed ex parte under Section 73 of the TNGST Act, 2017, for the tax period 2017-18. The petitioner contended that the assessment order was passed without considering exempted turnover and that the actual turnover did not cross the threshold limit. The petitioner also explained that the reply was not filed because their accountant failed to inform them about the uploaded show cause notice and order on the GST portal. The disputed amount is not explicitly stated, but the assessment order pertains to a turnover of Rs.3,07,12,499/-.

Held

The Court held that an opportunity should be granted to the assessee to present their submissions and produce relevant supporting documents before the respondent assessing officer. The Court reasoned that considering the nature of the discrepancies, the explanation provided by the assessee, and the reason given for not availing the opportunity, it was equitable to grant another chance. The principle adopted is that High Courts can extend such opportunities on equitable grounds, albeit under appropriate conditions. The impugned order dated 18.12.2023 was set aside, and the matter was remanded back to the respondent. The Court directed the petitioner to deposit 25% of the disputed tax amount within four weeks. Upon deposit, the petitioner must appear before the respondent, submit their reply and documents, and the respondent shall consider the matter afresh and pass orders in accordance with the law. Any bank account attachment made pursuant to the impugned order was also ordered to be raised.

Key Issues

1. Whether the ex parte assessment order passed under Section 73 of the TNGST Act, 2017, is liable to be quashed for violating principles of natural justice, considering the petitioner's explanation for non-participation? Petitioner's arguments: The petitioner argued that the assessment order was illegal and passed without jurisdiction and in gross violation of the principles of natural justice. They contended that the respondent failed to consider the exempted turnover and that their actual turnover was below the threshold limit. The petitioner also submitted that the failure to file a reply was due to an oversight by their accountant, who did not inform them about the uploaded documents on the GST portal, and therefore, sought an opportunity to present their case with supporting documents. Revenue's arguments: The respondent, through the Additional Government Pleader, did not present any specific arguments against the petitioner's plea for an opportunity. The judgment notes that the assessment was made ex parte because the petitioner did not utilize the opportunities provided.