M/S. Arni Engineering Tech Private Limited vs. The State Tax Officer - 1 (Inspection)

Facts

The petitioner, Arni Engineering Tech Private Limited, filed a writ petition challenging an order dated 16.01.2025 passed by the first respondent, the State Tax Officer – 1 (Inspection). This order was for the assessment year 2018-2019. The petitioner contended that a prior order dated 05.09.2024, passed by the second respondent under Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017, was issued without any notice. Furthermore, the petitioner argued that the subsequent order dated 16.01.2025 was passed by the first respondent without issuing a notice and without following the procedure contemplated under Section 161 of the TNGST Act, 2017 for rectification of errors, thereby violating the principles of natural justice. The respondents, through the learned Government Advocate, fairly submitted to a remand for reconsideration.

Held

The Court held that the matter should be remanded back to the first respondent for fresh consideration. The Court directed the first respondent to review the petitioner's case, taking into account the petitioner's contention that the earlier assessment order was passed without affording sufficient opportunity of hearing. Additionally, the first respondent was instructed to consider the petitioner's grievance that the subsequent order dated 16.01.2025 was passed without notice or in compliance with the procedure contemplated under Section 161 of the TNGST Act, 2017. The first respondent is to pass appropriate orders on merits and in accordance with law, after giving due opportunity of hearing to the petitioner, within a period of four months from the date of receipt of a copy of this order. The ratio decidendi is that orders passed in violation of natural justice principles, particularly without notice or proper procedural adherence, are liable to be set aside and remanded for fresh adjudication.

Key Issues

1. Whether the order dated 16.01.2025, passed by the first respondent, is liable to be quashed for violation of the principles of natural justice, specifically for being passed without issuing notice to the petitioner? 2. Whether the first respondent erred in passing the order dated 16.01.2025 without invoking the procedure contemplated under Section 161 of the TNGST Act, 2017 for rectification of errors, and if so, whether this vitiates the said order? Petitioner's Contentions: The petitioner argued that both the initial order dated 05.09.2024 and the subsequent order dated 16.01.2025 were passed without providing adequate notice or opportunity of hearing, violating the principles of natural justice. They specifically highlighted that the first respondent failed to follow the procedure under Section 161 of the TNGST Act, 2017 for rectification of errors before issuing the impugned order. Respondents' Contentions: The learned Government Advocate for the respondents fairly conceded that the matter could be remanded back to the first respondent for reconsideration.