Tvl. A P R Explosives vs. The State Tax Officer

Facts

The petitioner, Tvl.A.P.R.Explosives, represented by its Proprietor Sounder Raj, filed a writ petition challenging an order dated 31.01.2024 passed by the respondent, The State Tax Officer, Tirunelveli Town Assessment Circle. This order pertains to the assessment year 2019-20. The impugned order followed several notices, including ASMT-10 dated 23.06.2022, GST DRC 01A dated 08.11.2022, GST DRC 01 dated 09.12.2022, and three personal hearing notices dated 05.01.2023, 10.03.2023, and 21.03.2023. The petitioner claimed to be a small-time operator unaware of the order and preceding notices, which were posted on the GST common portal. The respondent argued that the writ petition was time-barred and barred by laches, citing Supreme Court decisions.

Held

The Court decided to set aside the impugned order and remit the case back to the respondent for a fresh assessment. The reasoning was that while the respondent had raised valid points regarding the petitioner's failure to participate in the proceedings and the potential time-bar of the writ petition and appeal, the Court found that the petitioner may have an arguable case on merits. Therefore, to provide an opportunity to the petitioner to present their case, the Court intervened. The impugned order was to be treated as an addendum to the show cause notice. The petitioner was directed to deposit 25% of the disputed tax within 30 days. The petitioner was also directed to file a reply within 30 days, after which the respondent was to pass a fresh order on merits after providing a personal hearing. The respondent was expected to pass the fresh order expeditiously, preferably within three months. The Court expressly left undecided the merits of the case, focusing on procedural fairness.

Key Issues

1. Whether the impugned order dated 31.01.2024, passed for the assessment year 2019-20, is liable to be quashed for illegality, lack of jurisdiction, and violation of principles of natural justice, as argued by the petitioner? The petitioner contended that they were unaware of the impugned order and the preceding notices due to being a small-time operator and the notices being posted on the GST common portal, thus seeking a fresh assessment with an opportunity for a personal hearing. 2. Whether the writ petition is liable to be dismissed on grounds of being time-barred and suffering from laches, as argued by the respondent? The respondent relied on the Supreme Court's decisions in Assistant Commissioner (CT) LTU, Kakinada and others vs. Glaxo Smith Kline Consumer Health Care Limited and Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others, and also pointed out that the appellate remedy under Section 107 of the respective GST Enactments was also time-barred.