Tvl.Uthirapathi Contractor vs. The State Tax Officer (Inspection I)

Facts

The petitioner, Tvl. Uthirapathi Contractor, represented by its Proprietor P. Uthirapathi, filed a writ petition challenging an order passed by the Respondent, the State Tax Officer (Inspection-I), Thiruvarur Division. The impugned order, dated 05.09.2024, pertains to the tax period 2019-20. The petitioner sought to quash this order, alleging it was illegal and passed in gross violation of the principles of natural justice. Specifically, the petitioner requested a fresh assessment after being provided an opportunity for a personal hearing as per the GST Act, 2017. The Respondent's counsel submitted that the petitioner had paid the tax amount pursuant to a DRC-01 notice, and the current show cause notice was only for interest and penalty.

Held

The Court held that the impugned assessment order is set aside. The reasoning for this decision is based on the fact that the issue raised in the writ petition is covered by a previous order of the same Court in a batch of writ petitions (W.P.(MD) No.26481 of 2024 etc., dated 06.01.2025). Although the respondent stated that the tax amount was paid and the notice was only for interest and penalty, the Court considered that this information was only available on the portal. The Court's primary concern appears to be the procedural aspect, particularly the opportunity for a hearing. The ratio decidendi is that where a statutory authority passes an order without affording the assessee a proper opportunity of hearing, and such a situation is covered by a precedent, the order should be set aside. The operative direction is that the petitioner must submit their reply within two weeks of receiving the order, after which the respondent shall pass orders on merits after providing a personal hearing. Any bank attachment made shall also be raised.

Key Issues

1. Whether the impugned order dated 05.09.2024, passed by the Respondent, is illegal and in gross violation of the principles of natural justice, specifically concerning the lack of a personal hearing for the petitioner? Petitioner's Arguments: The petitioner contended that the impugned order was passed in violation of the principles of natural justice, as they were not provided with a personal hearing. They sought to quash the order and have a fresh assessment done after affording them an opportunity for a personal hearing as mandated by the GST Act, 2017. Respondent's Arguments: The learned Additional Government Pleader submitted that the petitioner had already paid the tax amount pursuant to a DRC-01 notice. The present show cause notice was issued solely for the collection of interest and penalty. The judgment does not record any further arguments from the respondent regarding the procedural fairness of the impugned order.