Tvl. Nellai Agencies vs. The Deputy State Tax Officer-1

Facts

The petitioner, Tvl. Nellai Agencies, filed a writ petition challenging an order dated 28.12.2023 passed by the Deputy State Tax Officer-1, Tiruchendur Assessment Circle, for the tax period 2017-18. The petitioner stated that their GST registration was cancelled on 05.09.2019 and they failed to notice notices issued for GST DRC-01 and personal hearing notices. The petitioner contended that if given an opportunity, they could explain their case and were willing to deposit 10% of the disputed tax for a rehearing.

Held

The Court held that the impugned order dated 28.12.2023 was passed in violation of the principles of natural justice. The Court noted the petitioner's submission that their GST registration was cancelled on 05.09.2019, leading to their failure to notice subsequent notices. The Court also recorded the petitioner's willingness to deposit 10% of the disputed tax. Consequently, the Court quashed the impugned order and remitted the case back to the respondent for a fresh decision. The petitioner was directed to deposit 10% of the disputed tax within 30 days. The impugned order was to be treated as an addendum to the show cause notice, and the petitioner was to file their reply within a stipulated time after the deposit. The respondent was directed to pass a final order on merits after providing the petitioner an opportunity of personal hearing, preferably within three months.

Key Issues

1. Whether the impugned order dated 28.12.2023 passed by the respondent is illegal and in gross violation of the principles of natural justice, particularly concerning the opportunity of personal hearing, as contemplated under the GST Act? The petitioner argued that the impugned order was passed in violation of natural justice because they were unaware of the notices due to their GST registration having been cancelled prior to the issuance of the notices. They claimed they were not afforded a proper opportunity of personal hearing. They further submitted that they were willing to deposit 10% of the disputed tax as a condition for the case to be reheard. The respondent, represented by the Government Advocate, did not record any specific arguments against the petitioner's plea for a rehearing and opportunity to present their case.