M/S. Sri Muneeswara Agency vs. The State Tax Officer

Facts

The petitioner, M/s. Sri Muneeswara Agency, filed a writ petition before the Madurai Bench of the Madras High Court challenging an assessment order dated 28.08.2024, passed by the respondent, the State Tax Officer, for the assessment year 2019-2020. The petitioner contended that due to a lack of knowledge about GST and limited portal access, they relied on a part-time accountant who failed to inform them of the assessment proceedings. Consequently, the petitioner was unable to participate in the adjudication process, leading to an ex parte order. The respondent argued that a show cause notice (DRC-01) was issued on 16.05.2024, followed by personal hearing notices on 22.07.2024, 14.08.2024, and 19.08.2024, and therefore, the order should not be interfered with. The respondent also pointed out that the petitioner had an alternative appeal remedy under Section 107 of the GST Act, 2017.

Held

The Court noted the submission by the learned Government Advocate that the petitioner has an appeal remedy before the appellate Deputy Commissioner (ST) (GST Appeals), Madurai, under Section 107 of the GST Act, 2017. Consequently, the writ petition was disposed of by granting liberty to the petitioner to approach the appellate authority. The Court directed that if an appeal is filed within two weeks from the date of receipt of a copy of the order, the appellate authority shall entertain the appeal without reference to the period of limitation. The appellate authority was further directed to dispose of the appeal in accordance with law within three months thereafter. The Court made no order as to costs. The issue of whether the assessment order was passed without jurisdiction or sufficient opportunity was not directly decided by the High Court, as it directed the petitioner to avail the statutory remedy.

Key Issues

1. Whether the assessment order dated 28.08.2024, passed by the respondent for the assessment year 2019-2020, is liable to be quashed on the grounds of lack of opportunity for the petitioner to participate in the proceedings, as argued by the petitioner? 2. Whether the petitioner, having failed to avail the statutory appeal remedy under Section 107 of the GST Act, 2017, is precluded from approaching the High Court under Article 226 of the Constitution, as contended by the respondent? Petitioner's Contention: The petitioner argued that the ex parte assessment order was passed due to their reliance on a part-time accountant who failed to inform them about the assessment proceedings, leading to a lack of opportunity to participate. They sought to quash the order and have a fresh assessment order passed. Respondent's Contention: The respondent contended that proper procedure was followed, including the issuance of a show cause notice and personal hearing notices, and that the petitioner has an alternative statutory remedy of appeal under Section 107 of the GST Act, 2017, which they failed to pursue before approaching the High Court.