Tvl Trms Exporters vs. The Deputy State Tax Officer

Facts

The petitioner, Tvl.TRMS Exporters, represented by its Proprietor R.Suresh Kumar, filed a Writ Petition challenging an assessment order dated December 21, 2023, passed by the respondent, The Deputy State Tax Officer, for the tax period 2017-18. The petitioner contended that neither the show cause notices nor the assessment order were served upon them, and they were unable to access the GSTIN portal to participate in the proceedings. The assessment order rejected the petitioner's claim for Input Tax Credit (ITC) due to a mismatch between GSTR-3B and GSTR-2A, and non-payment of Reverse Charge Mechanism (RCM) liability for freight charges. The petitioner stated they could explain these discrepancies if given an opportunity.

Held

The Court held that the petitioner was not afforded a reasonable opportunity of hearing due to the alleged non-service of notices and portal accessibility issues. The Court acknowledged the petitioner's submission regarding technical glitches during the initial GST implementation phase and their readiness to explain the discrepancies. The Court found merit in the petitioner's plea for a fresh opportunity to present their case. Consequently, the Court directed the petitioner to deposit 25% of the disputed tax within two weeks. Upon compliance, the impugned assessment order would be treated as a show cause notice, and the petitioner would be required to submit their objections with supporting documents within four weeks. The respondent was directed to consider these objections and pass a fresh order after providing a reasonable opportunity of hearing. The Court explicitly stated that if the deposit or objections were not filed within the stipulated periods, the original assessment order would stand revived. The Court did not expressly leave any issue undecided.

Key Issues

1. Whether the assessment order dated December 21, 2023, passed by the respondent for the year 2017-18 is liable to be quashed on the grounds of non-service of notices and the petitioner's inability to access the GSTIN portal, thereby violating principles of natural justice? Petitioner's arguments: The petitioner argued that the assessment order is illegal and devoid of merits because they were not served with the show cause notices or the final assessment order. They further contended that technical glitches in the GST portal and the initial adaptation period to the e-mechanism prevented them from responding to notices and participating in adjudication. They relied on the High Court's judgment in M/s.K.Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise. The petitioner also expressed willingness to deposit 25% of the disputed tax and sought a final opportunity to present their objections. Respondent's arguments: The learned Additional Government Pleader appearing for the respondent did not raise any serious objection to the petitioner's request for a final opportunity, provided certain conditions were met.