Tvl Milan Footwear vs. The State Tax Officer
Original PDF →Facts
The petitioner, Tvl. Milan Footwear, represented by its proprietor, filed a writ petition challenging an order of adjudication dated December 22, 2023, passed by the respondent, The State Tax Officer, for the period 2017-2018. The petitioner argued that the tax was levied on the sale of vegetables, which are exempt. Furthermore, the petitioner contended that the assessment order was passed without granting sufficient opportunity, as the DRC-01 notice dated November 30, 2023, was uploaded on December 18, 2023, requiring a response by December 20, 2023. The petitioner claimed inability to access the portal and respond within the stipulated time. The respondent countered that the petitioner filed the writ petition approximately 10 months after the order was passed and should have availed the appellate remedy.
Held
The Court held that the impugned order of assessment should be treated as a show cause notice, and the petitioner should be granted a final opportunity to present their objections. The Court reasoned that the petitioner's inability to respond within the stipulated time was due to technical glitches and the complexities of adapting to the e-mechanism, as well as the short timeframe provided. The Court acknowledged the petitioner's submission regarding exempt sales of vegetables and the alleged mismatch between GSTR-3B and GSTR-2A, which could be addressed during the renewed opportunity. The Court directed the petitioner to deposit 25% of the disputed tax within two weeks and submit objections with supporting documents within four weeks. The respondent was directed to consider these objections and pass orders after affording a reasonable opportunity of hearing. The ratio decidendi is that in cases of procedural irregularities and technical difficulties leading to a violation of natural justice, a High Court may, in its writ jurisdiction, grant a final opportunity to an assessee to present their case, subject to certain conditions like partial deposit of the disputed tax.
Key Issues
1. Whether the impugned order of adjudication dated December 22, 2023, passed by the respondent for the period 2017-2018 is illegal, arbitrary, and without jurisdiction, violating principles of natural justice? Petitioner's arguments: The petitioner contended that the order was passed without sufficient opportunity, citing the short window between the upload of DRC-01 and the issuance of the final order, and technical glitches in the GST portal. The petitioner also argued that taxes were levied on exempt sales of vegetables. The petitioner relied on the judgment in M/s.K.Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise. The petitioner expressed willingness to deposit 25% of the disputed tax and sought a final opportunity to present objections. Respondent's arguments: The respondent argued that the petitioner filed the writ petition belatedly, nearly 10 months after the order, and should have pursued the statutory appeal mechanism. The respondent did not raise serious objections to the petitioner's request for a final opportunity, provided the conditions were met.
Sections Cited
DRC-01
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Before: and
The present Writ Petition is filed challenging the impugned order issued by the respondent in GSTIN:33ANJPM4692C1ZO/2017-18 dated 22.12.2023. 2.The petitioner is a dealer in footwear and vegetables and he is challenging the order of adjudication dated 22.12.2023 for the period 2017 to 2018, on the premise that taxes have been levied on the sales of vegetables, which is exempted. That apart, the learned counsel for the petitioner would submit that the impugned order of assessment has been passed, without granting sufficient opportunity to the petitioner. DRC-01, though dated 30.11.2023, was actually uploaded in the portal only on 18.12.2023. The petitioner was required to respond to the above notice by 20.12.2023. The petitioner was unable to access the portal and was not able to respond. It is submitted that the impugned order came to be passed on 22.12.2023, ie., four days after the DRC-01 was uploaded and therefore, it is submitted that the impugned order suffers from the violation of principals of natural justice. 3.To the contrary, the learned Government Advocate for the respondent would submit that the impugned order has passed on 22.12.2023 and if the petitioner aggrieved by the same, they have to prefer an appeal or challenge the same by way of writ petition, within stipulated period. Instead, the petitioner 2/6 https://www.mhc.tn.gov.in/judis filed the present petition, almost after 10 months since the date of passing of the order. 4.The limited issue that arises for consideration in the impugned order is the alleged mismatch between GSTR-3B and GSTR-2A. It is submitted by the learned counsel for the petitioner that if the petitioner is provided with an opportunity, he would be able to explain the alleged discrepancies between GSTR-3B and GSTR-2A. 5.The learned counsel for the petitioner would place reliance upon the recent judgment of this Court in the case of M/s.K.Balakrishnan, Balu Cables vs. O/o. the Assistant Commissioner of GST & Central Excise in W.P. (MD)No.11924 of 2024 dated 10.06.2024. 6.It was submitted by the learned counsel for the petitioner that with the introduction of GST, there were several technical glitches in the portal and the assessees were also taking time to adapt to the e-mechanism and it was only in view of the same that the petitioner was unable to respond to the above notices and the order of adjudication. It was further submitted that the petitioner is ready and willing to pay 25% of the disputed tax and that he may be granted one final opportunity before the adjudicating authority to put forth their objections to the proposal, to which the learned Additional Government Pleader 3/6 https://www.mhc.tn.gov.in/judis appearing for the respondent does not have any serious objection. 7.In view thereof, the petitioner shall deposit 25% of the disputed tax within a period of two (2) weeks from the date of receipt of a copy of this order. On complying with the above condition, the impugned order of assessment shall be treated as show cause notice and the petitioner shall submit its objections along with supporting documents/material within a period of four (4) weeks from the date of receipt of a copy of this order. If any such objections are filed, the same shall be considered by the respondent and orders shall be passed in accordance with law after affording a reasonable opportunity of hearing to the petitioner. If the above deposit is not paid or the objections are not filed within the stipulated period, i.e., two weeks and four weeks from the date of receipt of a copy of this order respectively, the impugned order of assessment shall stand revived. 8.Accordingly, the Writ Petition stands disposed of. There shall be no order as to costs. Consequently, connected miscellaneous petitions are closed.
2024 Index : Yes / No Internet : Yes/ No gns 4/6 https://www.mhc.tn.gov.in/judis To The State Tax Officer, Uthamapalayam Assessment Circle, Uthamapalayam-625533
5/6 https://www.mhc.tn.gov.in/judis MOHAMMED SHAFFIQ
, J.
gns
2024 6/6 https://www.mhc.tn.gov.in/judis
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.