M/S. Jothi Agency vs. State Tax Commissioner (GST)
Original PDF →Facts
The petitioner, M/s. Jothi Agency, filed a writ petition challenging an order dated 23.05.2022 passed by the State Tax Officer (Circle), Kovilpatti. The petitioner, a retail dealer of edible oil, had filed GSTR-1 and GSTR-3B returns for the period 01.04.2022 to 31.03.2022. A notice dated 10.02.2022 was issued alleging a gross variance between GSTR-1 and GSTR-3B. The petitioner filed objections on 06.05.2022, stating a difference of Rs. 3,26,721/- as opposed to the Rs. 59,57,314/- stated in the notice. The petitioner claimed that these objections and supporting documents were not considered, and no personal hearing was granted, leading to a cryptic and non-speaking order.
Held
The Court held that the impugned order was a cryptic and non-speaking order, which cannot be sustained. It found that the petitioner had filed their writ petition within the period available for filing an appeal. The Court noted that the petitioner's calculation of the difference was not considered in the impugned order, and the reason for not accepting the petitioner's calculation was not provided. The Court also observed that the classification of goods was questioned, which necessitated a personal hearing and perusal of documents. Therefore, the Court set aside the impugned order and directed that the petitioner be given an opportunity for a personal hearing. The petitioner was directed to approach the respondents within 30 days of receiving the order to seek a personal hearing, and the second respondent was directed to conclude the show cause proceedings and pass appropriate orders within three months.
Key Issues
1. Whether the impugned order dated 23.05.2022, passed by the State Tax Officer, is a valid and speaking order, considering the petitioner's objections and request for personal hearing? The petitioner argued that the impugned order was cryptic, non-speaking, and passed without considering their objections dated 06.05.2022 and without affording a personal hearing, despite a significant difference in the disputed amount. They contended that the difference in returns was due to a 'technical hitch' and that the classification of goods also required clarification. The petitioner sought to quash the order and direct the respondent to pass fresh orders after considering their objections and providing an opportunity for a personal hearing. The respondents contended that the petitioner had given up the option of personal hearing in their reply to the show cause notice. They also submitted that the petitioner had an alternative remedy of appeal under Section 107 of the GST Act within 90 days of the impugned order.
Sections Cited
Section 107
AI-generated summary — verify with the full judgment below
Before: and
The petitioner is a proprietor of Jothi agency filed this writ petition seeking for quashing the impugned order in Reference No.ZD330522010718P, dated 23.05.2022. 2. The petitioner purchasing edible oil from the whole sale dealer and doing retail business. The petitioner filed monthly returns, namely, GSTR-1 and GSTR-3B under the Goods and Service Tax Act from 01.04.2022 to 31.03.2022. The petitioner was served with a notice on 10.02.2022 stating that on scrutiny of Form GSTR-1 Vs GSTR-3B, it was found grossly in variance. After receipt of the notice, the petitioner filed his objections on 06.05.2022 and informed that the difference is Rs.3,26,721/-, but the notice shown difference of Rs.59,57,314/-. The petitioner enclosed the difference between the purchase and sale details, tabulation also produced in the affidavit. These factors were not considered and further, no personal hearing was given to the petitioner and the impugned order, is cryptic an non- speaking order passed without details.
The learned Special Government Pleader for the respondents submits 2/6 that from the reply to the show cause notice, it is seen that the petitioner has given up the option of personal hearing. Further, he was not given full particulars and merely given the difference between GSTR-1 and GSTR-3B. On perusal of the records and documents, finding that the classification is also improper, returns are wrongly classified and with regard to the oil seeds and and oleaginous fruits, whether or not broken palm nuts and kernels of seed quality are not provided. In view of the same, the impugned order came to be passed. The petitioner on his own, given up the right of personal hearing and now filed this writ petition. He further submitted that under Section 107 of the GST Act, the petitioner has got 90 days to file his appeal, if he is aggrieved on the impugned order.
Considering the same and on perusal of the materials, it is seen that the petitioner has filed this writ petition within a period of appeal. Further, the petitioner in his reply filed an annexure showing the difference of calculation. In the impugned order, there is no reason given for why the petitioner's calculation was not considered. The petitioner’s submission in the show cause notice reply is that 'by a technical hitch'. The petitioner requires a personal hearing. Further, from the impugned order, it is seen that department has questioned the classification, which needs personal hearing and perusal of the 3/6 documents and thereafter, detailed order to be passed.
In view of the same, this Court finds that by cryptic non-speaking order, an impugned order cannot be passed. Hence, the impugned order is hereby set aside. The petitioner is to be given an opportunity for personal hearing and thereafter, on the documents submitted by the petitioner, the issue can be decided. The petitioner to approach the respondents within a period of 30 days from the date of receipt of copy of this order seeking for personal hearing within a period of three months. The second respondent is directed to conclude the show cause proceedings and pass appropriate orders.
With the above direction, the writ petition stands disposed of. No costs. Consequently, connected miscellaneous petitions are closed.
2022 Index : Yes / No Internet : Yes/ No sn To 1.The State Tax Commissioner (GST), GST Office, 4th Floor, 4/6 Ezhilagam, Chepauk, Chennai-5. 2.The State Tax Officer (Circle), Kovilpatti, Tuticorin District. M.NIRMAL KUMAR, J.
sn 5/6
2022 6/6
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.