S.V.M.Tiles vs. The State Tax Officer

Held

The Court held that the impugned assessment order dated January 13, 2021, was vitiated due to a violation of the principles of natural justice and statutory provisions. The Court found that the petitioner's contention regarding the non-service of a mandatory notice under Section 73(1) of the TNGST Act was well-founded. While the respondent claimed that Form GST DRC-01 was uploaded to the common portal on December 25, 2020, the Court noted that the respondent's counter affidavit did not state that the Section 73(1) notice itself was uploaded along with the DRC-01 summary. Rule 142(1) of the TNGST Rules mandates that a summary of the notice under Section 73(1) in Form GST DRC-01 shall be served electronically along with the notice. The Court concluded that only the DRC-01 summary was uploaded, not the Section 73(1) notice, thus failing to comply with the statutory requirement. Consequently, the Court quashed the impugned order and remitted the matter back to the respondent for reconsideration. The respondent was directed to serve the notice under Section 73(1), followed by the summary in Form GST DRC-01, grant time for reply, and afford a personal hearing before passing a final order.

Facts

The petitioner, S.V.M. Tiles, a registered dealer, migrated to the GST regime from the Tamil Nadu Value Added Tax (TNVAT) Act. They were granted Input Tax Credit (ITC) of Rs. 7,60,172/- based on their TRAN 1 application filed on October 6, 2017, for the period ending June 30, 2017. Subsequently, on November 13, 2020, the respondent, the State Tax Officer, issued an intimation of tax payable under Section 73(5) of the TNGST Act. The petitioner disputed this intimation. Thereafter, on January 13, 2021, the respondent passed an assessment order, reversing the ITC of Rs. 7,60,172/- and demanding payment of this amount along with a 100% penalty. Aggrieved, the petitioner filed a writ petition challenging this order.

Key Issues

1. Whether the impugned assessment order dated January 13, 2021, is vitiated due to a violation of the principles of natural justice and statutory provisions, specifically the non-service of a mandatory notice under Section 73(1) of the TNGST Act, as contended by the petitioner? The petitioner argued that the respondent failed to issue a notice under Section 73(1) and a statement under Section 73(3) of the TNGST Act before passing the impugned order. They contended that the intimation under Section 73(5) was disputed, necessitating the issuance of a Section 73(1) notice. The petitioner asserted that the absence of these mandatory notices rendered the assessment order void. The respondent argued that the service of notice was completed in accordance with Section 169 of the TNGST Act. They contended that the notice under Section 73(1), along with Form GST DRC-01, was uploaded to the common portal, which constitutes effective service as per Section 169(1)(d). Therefore, the petitioner's claim of non-service of notice was unsustainable.