Tvl. The Ramsons Associates vs. The Deputy State Tax Officer 1

Facts

The petitioner, Tvl. The Ramsons Associates, filed a writ petition challenging an order dated 27.12.2023 passed by the Deputy State Tax Officer-1, Kovilpatti-II Circle, for the tax period 2017-18. The impugned order was preceded by notices in Form GST DRC 01A dated 19.09.2023 and Form GST DRC 01 dated 25.09.2023. The respondent claimed that three personal hearing notices were sent to the petitioner, but the petitioner failed to appear, leading to the order being passed based on available materials. The petitioner contended they were unaware of the notices posted on the GST common portal and the impugned order.

Held

The Court quashed the impugned order dated 27.12.2023. The Court found that while the respondent had issued notices and the petitioner had not appeared for personal hearings, the petitioner's claim of being unaware of the portal communications warranted consideration. The Court exercised its discretion in favour of the petitioner, acknowledging a potential case on merits. The quashed order was to be treated as an addendum to the show cause notice. The petitioner was directed to deposit 10% of the disputed tax within 30 days from the receipt of the order. The petitioner was also required to file a reply within 30 days, after which the respondent would pass fresh orders on merits and in accordance with law, providing a personal hearing to the petitioner, preferably within three months. The issue of whether the writ petition was time-barred was not definitively decided but discretion was exercised to allow the petitioner to present their case.

Key Issues

1. Whether the impugned order dated 27.12.2023, passed by the respondent, is illegal and in gross violation of the Principles of Natural Justice, particularly concerning the opportunity of a personal hearing as per the provisions of the GST Act? Petitioner's arguments: The petitioner, a small-scale operator, was unaware of the notices sent to the GST common portal and the subsequent impugned order. They were not provided with a proper opportunity of personal hearing. Respondent's arguments: The Writ Petition is hopelessly time-barred due to latches, citing the Supreme Court decision in Assistant Commissioner (CT) LTU, Kakinada vs. Glaxo Smith Kline Consumer Health Care Limited. Furthermore, the appellate remedy under Section 107 of the respective GST Enactments is also time-barred, as held by the Supreme Court in Singh Enterprises vs. Commissioner of Central Excise, Jamshedpur. Therefore, the writ petition should be dismissed.