Tvl. 0 1919 Tenkasi Shencottai Taluk Agricultural Co Op Society vs. The State Tax Officer

Facts

The petitioner, Tvl.0.1919 Tenkasi Shencottai Taluk Agricultural Co Op Society, filed two writ petitions challenging orders passed by the Respondent, the State Tax Officer, Tenkasi Assessment Circle. The impugned orders, dated 06.07.2023, pertained to GST for the periods 2018-2019 and 2019-2020. The petitioner sought to quash these orders, alleging violation of natural justice, and requested a fresh assessment with a personal hearing. The Respondent's counsel informed the Court that Rs.15,00,000/- was frozen and recovered from the petitioner's account as part of the liability under the impugned orders.

Held

The Court held that the impugned orders passed by the Respondent were liable to be set aside due to a violation of the principles of natural justice. The Court found that the orders were passed before the petitioner had filed their reply to the notices issued under the GST enactments. Consequently, the Court quashed the impugned orders and remanded the case back to the Respondent for a fresh assessment. The Court directed the petitioner to file a consolidated reply within 30 days of receiving the order and the Respondent to pass fresh orders within 30 days thereafter, ensuring that the petitioner is heard before any fresh orders are passed. The quashed orders were to be treated as a corrigendum to the earlier show cause notices. The principle established is that statutory authorities must provide an opportunity for a hearing and consider the assessee's reply before passing adverse orders, adhering to the principles of natural justice.

Key Issues

1. Whether the impugned orders passed by the Respondent are liable to be quashed for violating the principles of natural justice, specifically by passing orders before the petitioner filed a reply to the show cause notices issued under the GST enactments? (Question of law) Petitioner's Contention: The petitioner argued that the impugned orders were passed in gross violation of the principles of natural justice. They contended that the orders were issued before they had an opportunity to file their reply to the notices, thus denying them a fair hearing. They sought a direction to re-do the assessment afresh after providing a personal hearing. Respondent's Contention: The respondent did not record any specific arguments against the petitioner's claim regarding the violation of natural justice. However, their counsel informed the court about the recovery of Rs.15,00,000/- towards part liability.