Tvl. Sri Ramakrishna Agencies vs. The Commissioner Of Commercial Taxes

Facts

The petitioner, Tvl.Sri Ramakrishna Agencies, filed a writ petition challenging an assessment order dated 16.12.2023 passed by the second respondent, the State Tax Officer, for the assessment year 2020-2021. The petitioner, engaged in works contracts for local bodies, contended that the assessment order was passed without properly considering that while they report turnover upon completion of work, the local body (recipient) reports Tax Deducted at Source (TDS) only when the bill is honoured. The petitioner alleged suppression of turnover was incorrectly estimated by comparing GSTR-3B with GSTR-7. Furthermore, the petitioner claimed that proper notices and the impugned order were not duly served, depriving them of an opportunity to explain, and that the limitation period for filing a statutory appeal had lapsed. The respondents argued that show cause notices and personal hearing notices were issued, and the petitioner had an appeal remedy under Section 107 of the TNGST 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 of Commercial Taxes (GST), Madurai, under Section 107 of the TNGST Act, 2017. Consequently, the writ petition was disposed of with liberty granted to the petitioner to approach the appellate authority. The petitioner was permitted to raise all grounds raised in the writ petition before the appellate authority. The Court directed that if an appeal is filed within two weeks from the date of receipt of the order, the appellate authority shall entertain the appeal without reference to the period of limitation and dispose of it in accordance with law within three months thereafter. The Court did not decide the merits of the petitioner's challenge to the assessment order itself, nor did it make any findings on the alleged procedural irregularities or the substance of the tax dispute. The operative direction was to allow the petitioner to pursue the statutory appeal remedy.

Key Issues

1. Whether the assessment order dated 16.12.2023, passed by the second respondent for the assessment year 2020-2021, is liable to be quashed for allegedly failing to consider the petitioner's submission regarding the timing difference in reporting turnover and TDS, and for estimating suppression of turnover based on a comparison of GSTR-3B and GSTR-7? (Question of fact and law, turning on principles of natural justice and correct assessment procedures under GST law). 2. Whether the impugned order is vitiated by a failure to duly serve notices and the order itself, thereby violating the principles of natural justice and the procedural requirements of the GST Act? (Question of fact and law, turning on procedural fairness). 3. Whether the petitioner is precluded from approaching the High Court directly due to the availability of an alternative statutory remedy of appeal under Section 107 of the TNGST Act, 2017, especially when the limitation period for filing such appeal has lapsed? Petitioner's arguments: The assessment order is unjustified due to the failure to consider the TDS reporting discrepancy and the incorrect estimation of turnover suppression. Proper notices were not served, violating natural justice. The appeal period has lapsed, making the order unjust. Respondents' arguments: Show cause notice (DRC-01) and personal hearing notices were issued. The petitioner has an alternative appeal remedy under Section 107 of the TNGST Act, 2017, and should have availed it instead of approaching the High Court.