Tvl Saleem Stores vs. The Deputy State Tax Officer 2

Facts

The petitioner, Tvl. Saleem Stores, represented by its Proprietor Mohamed Salim, filed a writ petition challenging an assessment order dated 26.04.2024, passed by the respondent, The Deputy State Tax Officer - 2, Uthamapalayam Assessment Circle. The assessment pertains to the year 2018-2019. The petitioner contended that neither the show cause notice nor the final assessment order was served on them, and the order was only uploaded to the GSTIN portal, which they were unable to access. This prevented them from participating in the adjudication proceedings. The core of the dispute involves an alleged mismatch between GSTR-2A and GSTR-3B. The petitioner expressed readiness to explain these discrepancies if given an opportunity and offered to deposit 25% of the disputed tax.

Held

The Court quashed the impugned assessment order dated 26.04.2024. The reasoning was based on the petitioner's contention that they were not properly served with the show cause notices and the final order, and faced difficulties accessing the GST portal, thus being denied an opportunity to be heard. The Court acknowledged the petitioner's submission regarding technical glitches and the learning curve associated with the GST portal. The petitioner's willingness to deposit 25% of the disputed tax was a significant factor. The Court directed the petitioner to deposit 25% of the disputed tax within two weeks of receiving the order. Upon compliance, the impugned order would be treated as a show cause notice, and the petitioner would have four weeks to submit their objections with supporting documents. The respondent was then directed to consider these objections, provide a hearing, and pass a fresh order in accordance with the law. The Court stipulated that if the deposit or objections were not filed within the stipulated periods, the original assessment order would stand revived. The ratio decidendi is that a taxpayer must be afforded a reasonable opportunity of being heard, and procedural non-compliance by the revenue, coupled with a taxpayer's willingness to comply and participate, warrants a remand for fresh adjudication.

Key Issues

1. Whether the assessment order dated 26.04.2024, passed by the respondent for the year 2018-2019, is liable to be quashed on the grounds of non-service of notice and inability of the petitioner to access the GST portal, thereby violating principles of natural justice? The petitioner argued that the assessment order is illegal and devoid of merits because the show cause notices and the impugned order were not served personally. They claimed they could not access the GSTIN portal, preventing their participation in the proceedings. They further submitted that technical glitches in the GST portal and the initial adaptation period to the e-mechanism contributed to their inability to respond. They relied on the judgment in M/s.K.Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise. The petitioner is willing to deposit 25% of the disputed tax and seeks a final opportunity to present their objections. The respondent, represented by the Additional Government Pleader, did not raise any serious objection to the petitioner's request for an opportunity to present their case.