Teja Export vs. The Assistant Commissioner (St)

Held

The Court held that while the petitioner's contention regarding the lack of a specific show cause notice for Section 74 penalty was raised, the records showed that a notice in Form GST DRC-01A dated 14.11.2022 was issued, which indicated that a show cause notice under Section 74(1) would be issued if the tax was not paid. This was followed by further intimations and a show cause notice under Section 73. The Court found that the petitioner had not responded to any of these notices. Citing decisions of the Supreme Court 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 Court noted that a writ petition was not the appropriate forum for interference when statutory remedies were available and due process had been initiated. Therefore, the Court set aside the impugned order, treating it as a corrigendum/addendum to the previous notices, and permitted the petitioner to file a reply to the show cause notices and reminders, subject to depositing 25% of the disputed tax within 30 days. Failure to deposit would result in the writ petition being dismissed and the respondent proceeding with recovery.

Facts

The petitioner, Teja Export, filed a writ petition challenging an assessment order dated 27.08.2024, passed by the Assistant Commissioner (ST), Madurai Rural East Assessment Circle. The order demanded tax and imposed a penalty equivalent to 100% of the tax amount for the financial year 2019-20. The petitioner contended that the order was passed without jurisdiction and in violation of principles of natural justice, specifically alleging that a penalty under Section 74 of the TNGST Act was imposed without a proper show cause notice. The respondent revenue authority had issued notices in Form GST DRC-01A on 14.11.2022 and 15.11.2022, followed by a show cause notice under Section 73 on 10.02.2023, and reminders on 04.04.2024, 15.05.2024, and 06.08.2024. The petitioner did not respond to any of these notices.

Key Issues

1. Whether the impugned assessment order dated 27.08.2024 is without jurisdiction and barred by limitation, as contended by the petitioner? 2. Whether the penalty imposed under Section 74 of the TNGST Act is vitiated by a lack of proper show cause notice, violating principles of natural justice, as argued by the petitioner? Petitioner's Arguments: The petitioner argued that the impugned order is without jurisdiction and that the penalty under Section 74 of the TNGST Act was imposed without issuing a proper notice under the said section, alleging suppression of facts. The petitioner relied on the principle that a penalty under Section 74 requires a specific notice for that section. Revenue's Arguments: The respondent revenue authority, through the Additional Government Pleader, appeared and took notice. The judgment does not explicitly record separate arguments from the revenue beyond their submission that notices were issued. However, the court's perusal of the documents indicated that notices under both Sections 73 and 74 were issued in Form GST DRC-01A, and a show cause notice under Section 73 was also issued. The revenue implicitly argued that due process was followed by issuing these notices.