Tvl.Rahuman Traders vs. The State Tax Officer (Ciw)-1

Facts

The petitioner, Tvl. Rahuman Traders, represented by its Proprietor Mohamed Ismail, filed six writ petitions challenging orders dated 05.12.2023 passed by the State Tax Officer (CIW)-1, Tirunelveli. These orders were preceded by notices in DRC 01A and DRC 01, and personal hearing notices. The petitioner claimed that these notices were transferred to the GST common portal, which went unnoticed due to the petitioner being a small business dealer not fully conversant with technology. The petitioner's Chartered Accountant/Tax Practitioner also failed to intimate them. The respondent argued that the petitions were devoid of merit and that appellate remedies were time-barred.

Held

The Court held that the petitioner had a case to explain and should not be unjustly taxed, emphasizing the GST Act's philosophy of collecting just tax. Consequently, the impugned orders dated 05.12.2023 were set aside. The cases were remitted back to the respondent for a fresh order on merits and in accordance with law. This was made conditional upon the petitioner depositing 25% of the disputed tax from its Electronic Cash Register within 30 days of receiving the order. The Court noted that if the petitioner had already deposited Rs. 3,50,000/-, that amount would be deducted from the 25% deposit. The impugned orders were to be treated as addendums to the DRC 01A and DRC 01 notices, and the petitioner was to file consolidated replies within the 30-day period. The respondent was directed to pass fresh orders within three months thereafter. No issue was expressly left undecided.

Key Issues

1. Whether the impugned orders, passed without the petitioner filing a reply to the notices and without a personal hearing, are liable to be quashed for violating the principles of natural justice, particularly considering the petitioner's claim of technological non-familiarity and failure of their tax practitioner to inform them? (Question of law and fact, turning on principles of natural justice and procedural fairness under GST law). Petitioner's Contention: The petitioner argued that the notices and orders were not properly received due to technological issues and their lack of familiarity with the GST portal, leading to a violation of natural justice. They sought a fresh assessment with an opportunity for a personal hearing. Respondent's Contention: The respondent contended that the writ petitions were without merit and should be dismissed, citing the Supreme Court decisions in Assistant Commissioner (CT) LTU, Kakinada and others Vs. Glaxo Smith Kline Consumer Health Care Limited and Singh Enterprises Vs. Commissioner of C.Ex., Jamshedpur. The respondent also argued that appellate remedies were time-barred.