Tvl.Aaradhanaa Shipping Agencies vs. The State Tax Officer

Held

The Court held that the impugned order of assessment dated 26.12.2023, passed by the respondent for the tax period 2017-18, was to be set aside. The Court reasoned that the petitioner's contentions regarding the violation of natural justice due to improper service of notices and the inability to access the common portal were valid. The Court acknowledged the petitioner's submission about technical glitches and the learning curve associated with the GST portal. The Court also took note of the petitioner's willingness to deposit 25% of the disputed tax. Consequently, the Court directed the petitioner to deposit 25% of the disputed tax within two weeks of receiving the order. Upon compliance, the impugned assessment order would be treated as a show cause notice, and the petitioner would have four weeks to submit objections with supporting documents. The respondent was then directed to consider these objections and pass orders after affording a reasonable opportunity of hearing. The Court also stipulated that if the deposit or objections were not filed within the stipulated periods, the impugned assessment order would stand revived. No specific provision of the GST Act was explicitly discussed in relation to the violation of natural justice, but the general principles of the GST Act regarding assessment and opportunity to be heard were implicitly considered.

Facts

The petitioner, Tvl. Aaradhanaa Shipping Agencies, filed a writ petition challenging an order dated 26.12.2023 passed by the respondent, the State Tax Officer, Ettayapuram Assessment Circle, for the tax period 2017-18. The petitioner contended that neither the show cause notice nor the assessment order was properly served, as they were only uploaded to the common portal, which the petitioner could not access. This prevented the petitioner from participating in the adjudication proceedings. The core issue revolved around an alleged mismatch between GSTR-2A and GSTR-3B. The petitioner claimed that with an opportunity, they could explain these discrepancies, attributing initial non-response to technical glitches in the GST portal and the learning curve for e-mechanisms. The petitioner also offered to deposit 25% of the disputed tax.

Key Issues

1. Whether the impugned order of assessment dated 26.12.2023, passed by the respondent for the tax period 2017-18, is liable to be quashed for gross violation of the principles of natural justice due to improper service of notices and the assessment order, as argued by the petitioner? 2. Whether the petitioner should be granted a fresh opportunity to present their case and explain the alleged mismatch between GSTR-2A and GSTR-3B, considering the technical challenges faced with the GST portal and the petitioner's willingness to deposit 25% of the disputed tax? Petitioner's Arguments: The petitioner argued that the assessment order was illegal and passed in violation of natural justice because the show cause notice and the final order were not served personally or by registered post but only uploaded to the common portal, which they could not access. They relied on the judgment in M/s. K. Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise. They also submitted that technical glitches and the adaptation to the e-mechanism caused their inability to respond. They offered to deposit 25% of the disputed tax and sought a fresh opportunity for a personal hearing. Respondent's Arguments: The learned Government Advocate appearing for the respondent did not have any serious objection to the petitioner's request for a fresh opportunity.