Tvl.S.M.Pavers vs. The Assistant Commissioner (St)
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The petitioner, Tvl.S.M.Pavers, represented by its Partner K.Mosses, filed a writ petition challenging an assessment order dated 12.12.2023 passed by the respondent, the Assistant Commissioner (ST), Sivagangai, for the assessment year 2017-18. The impugned order was passed after the respondent issued notices in ASMT-10, DRC-01A, and DRC-01, and personal hearing notices, to which the petitioner failed to respond. The petitioner claimed to be unaware of these notices sent via the GST common portal and argued that the demand was confirmed based on a discrepancy between availed credit and auto-populated credit in Form GSTR-2A. The petitioner sought an opportunity to reply, as the credit availed and utilized was subsequently denied.
Held
The Court, considering the submissions and the fact that the dispute pertains to the initial period after the rollout of GST, decided to exercise its discretion partly in favour of the petitioner. The Court quashed the impugned order dated 12.12.2023. The quashed order will be treated as an addendum to the show cause notice dated 04.05.2023 in DRC-01A. The petitioner is directed to deposit 15% of the disputed tax from its Electronic Cash Ledger within 30 days and file a consolidated reply within the same period. Upon compliance, the respondent shall pass a fresh order on merits and in accordance with law within three months, ensuring the petitioner is heard before passing final orders. The ratio decidendi is that in the initial phase of GST implementation, courts may grant leniency to taxpayers who demonstrate a genuine lack of awareness of procedural notices, provided they comply with certain conditions like pre-deposit and timely response.
Key Issues
1. Whether the petitioner, having failed to respond to statutory notices and personal hearing notices issued by the respondent, is entitled to a fresh opportunity to present its case, particularly concerning the discrepancy in Input Tax Credit (ITC) for the 2017-18 period? Petitioner's contention: The petitioner was unaware of the notices sent to the GST common portal and therefore could not respond. They seek one opportunity to explain the discrepancy between availed and auto-populated ITC, especially since the credit was already utilized. Respondent's contention: The writ petition is devoid of merits and should be dismissed, citing the Supreme Court's decisions in Assistant Commissioner (CT) LTU, Kakinada and others Vs. Glaxo Smith Kline Consumer Health Care Limited and Singh Enterprises Vs. Commissioner of C.Ex., Jamshedpur. The respondent also argued that the appellate remedy is barred.
Sections Cited
Section 73, Section 129
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Before: and
The petitioner is before this Court against the impugned order dated 12.12.2023 passed by the respondent for the assessment year 2017-18. 2.The impugned order has preceded the notices in ASMT-10, DRC -01A and DRC-01. However, the petitioner has failed to reply to the same. The petitioner was also issued with personal hearing notices, which were also not responded to by the petitioner and thus, the respondent has passed the impugned order on 12.12.2023. 3.It is the case of the petitioner that the petitioner was unaware of the aforesaid notices that were sent to the petitioner in the GST common portal. He submits that the petitioner be given one opportunity, as the demand was confirmed based on the discrepancy between the credit availed and the credit that was auto populated in Form GSTR-2A. It is submitted that long after the credit was availed and utilized by the petitioner, the credit has been denied vide impugned order dated 12.12.2023. 2/6 https://www.mhc.tn.gov.in/judis
On the other hand, the learned Additional Government Pleader for the respondent would submit that the writ petition is devoid of merits and is liable to be dismissed, in view of the decision of the Hon'ble Supreme Court in Assistant of the decision of the Hon'ble Supreme Court in Singh Enterprises Vs. Commissioner of C.Ex., Jamshedpur reported in 2008 (221) E.L.T. 163 (S.C). Hence, he prays for dismissal of this writ petition. 6.Having considered the submissions made by the learned counsel for the petitioner and the learned Additional Government Pleader for the respondent and considering the fact that the dispute pertains to the initial period after the roll out of GST with effect from 01.07.2017. Therefore, this Court is inclined to exercise its discretion partly in favour of the petitioner subject to the petitioner depositing 15% of the disputed tax from its Electronic Cash Register within a period of 30 days from the date of receipt of a copy of this order. 3/6 https://www.mhc.tn.gov.in/judis
The impugned order, which stands quashed, shall be treated as addendum to the show cause notice dated 04.05.2023 in DRC -01A to the petitioner. The petitioner shall file a consolidated reply with a period of 30 days from the date of receipt of a copy of this order together with the aforesaid pre-deposit. 8.Subject to the above compliance, the respondent shall proceed to pass a fresh order on merits and in accordance with law within a period of 3 months thereafter. It is needless to state that the petitioner shall be heard before final orders are passed in the de novo proceedings. 9.The Writ Petition stands allowed, accordingly. No costs. Consequently, connected Miscellaneous Petition is closed. Index : Yes / No 27.06.2024 Internet : Yes / No mm To 4/6 https://www.mhc.tn.gov.in/judis The Assistant Commissioner (ST), Sivagangai, Commercial Tax Building, Sivagangai. 5/6 https://www.mhc.tn.gov.in/judis C.SARAVANAN, J.
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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.