S S R Connect vs. The Deputy State Tax Officer

Held

The Court allowed the writ petition, exercising its discretion in favour of the petitioner. It quashed the impugned order dated 30.12.2023 and directed that it be treated as an addendum to the earlier show cause notice. The petitioner was granted 30 days from the receipt of the order to file a reply and pay 10% of the disputed tax from their Electronic Cash Register. The respondent was directed to pass final orders on merits within three months thereafter. The Court also ordered the de-freezing of the petitioner's bank account after recovering the 10% amount, if available. The reasoning was based on the petitioner's submission of being a small operator unaware of the portal notices and their willingness to deposit 10% of the disputed tax, coupled with the Court's inclination to grant an opportunity. The ratio is that a reasonable opportunity to be heard should be provided, especially when a party demonstrates a lack of awareness of portal-based communications and offers a substantial deposit towards the disputed amount.

Facts

The petitioner, M/S.S.S.R.Connect, represented by its Proprietor, filed a writ petition seeking to quash an order dated 30.12.2023 passed by the Deputy State Tax Officer, Tuticorin – III Assessment Circle, under Section 73 of the TNGST Act, 2017. The petitioner contended that notices preceding the order were not noticed as they were hosted on the GST common portal, and being a small operator, they were not fully conversant with the portal's architecture. The petitioner claimed they could demonstrate the demand was unjust if given an opportunity and offered to deposit 10% of the disputed tax. The respondent argued for dismissal, citing Supreme Court decisions and the limitation period for appeals.

Key Issues

1. Whether the impugned order dated 30.12.2023, passed under Section 73 of the TNGST Act, 2017, is liable to be quashed on the ground that the petitioner was not afforded a proper opportunity to present their explanation due to non-receipt of notices hosted on the GST common portal? Petitioner's arguments: The petitioner argued that they are a small operator not fully conversant with the GST portal and therefore missed the notices and the impugned order. They asserted that an opportunity to explain would reveal the demand to be unjust and unwarranted. They also expressed willingness to deposit 10% of the disputed tax. Respondent's arguments: The respondent contended that the writ petition should be dismissed, relying on the Supreme Court's decision in Assistant Commissioner (CT) LTU, Kakinada and others Vs. Glaxo Smith Kline Consumer Health Care Limited. They also argued that any appeal would be time-barred under Section 107 of the TNGST Act, 2017, citing the Supreme Court's ruling in M/S. Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others.