Sri Chima Cars PVT LTD vs. The Assistant Commissioner (St)-Ii

Held

The Court held that the petitioner had a strong case for a rehearing. The assessment order dated 22.02.2025 was set aside on the grounds that the petitioner was not afforded an opportunity to present their case due to the alleged non-receipt of restriction notices. Additionally, the Court found merit in the petitioner's argument that the assessment order had travelled beyond the show cause notice, as the final demand exceeded the amount stated in the show cause notice. Consequently, the matter was remitted back to the respondent for fresh consideration. As a condition for this rehearing, the petitioner was directed to deposit Rs. 5,00,000/- within one month. Upon deposit, the respondent was to grant a personal hearing and pass orders on merits within four months. The petitioner was also directed to submit their reply to the 24 show cause notices along with documents within one month.

Facts

The petitioner, Sri Chima Cars Private Limited, filed a writ petition challenging an ex-parte assessment order dated 22.02.2025 passed by the Assistant Commissioner(ST)-II, Sattur. The petitioner contended that they received 24 notices on 12.11.2024 and requested a two-month extension to file a reply. Subsequently, restriction notices dated 07.02.2025 and 19.02.2025 were allegedly not received by the petitioner. Due to the non-submission of a reply within the stipulated time as per the restriction notice dated 19.02.2025, the respondent proceeded to pass an ex-parte assessment order. The petitioner also highlighted that the final order levied an amount exceeding one crore, whereas the show cause notice was for Rs. 43,48,389/-, indicating the assessment order travelled beyond the show cause notice.

Key Issues

1. Whether the ex-parte assessment order dated 22.02.2025, passed by the respondent, is illegal and against the principles of natural justice, particularly concerning the non-receipt of restriction notices and the alleged violation of the principle that an assessment order cannot travel beyond the show cause notice? (Mixed question of law and fact, concerning principles of natural justice and potentially Section 73 of the CGST Act or equivalent SGST Act provisions). Petitioner's arguments: The petitioner argued that the assessment order was passed without providing an opportunity to be heard, as the crucial restriction notices dated 07.02.2025 and 19.02.2025 were never received. Furthermore, the petitioner contended that the final assessment order levied a tax amount significantly exceeding that mentioned in the show cause notice, rendering the order invalid as it travelled beyond the scope of the original notice. Revenue's arguments: The judgment does not record any specific arguments made by the respondent (Revenue).