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2023 (9) TMI 43 - MADRAS HIGH COURTViolation of principles of natural justice - availment of fraudulent credit - invoice issued without supply of goods - Order passed based on assumptions - levy of 100% penalty - HELD THAT:- The respondents are empowered to pass order within a period of five years - this Court is of the considered opinion that, if it is considered as outer time limit prescribed for the respondents to pass orders, then the respondents may be empowered to pass orders. But the assessee must be given sufficient opportunity. In the present case the notice was issued on 01.12.2022 and 03.01.2023 and Summary Order was passed on 07.03.2023, i.e. within two months the respondents have passed an order. Even though the provisions prescribe five years as outer limit but the provisions do not prescribe minimum time from passing order, in such circumstances the respondents ought to have passed order within reasonable time. Two months period definitely is not reasonable time and the petitioner is right in stating that adequate opportunity was not granted to the petitioner. Levy of 100% penalty - HELD THAT:- The respondents have completed the entire proceedings within two months and there is violation of principles natural justice. Also, this Court has held that the respondents ought to have concluded the proceedings within reasonable time even though the outer time limit is five years. By passing the orders early, the respondent have denied the valuable right of the petitioner to avail the concession granted under section 74. The petitioner has already paid the entire tax liability and the interest. Therefore, this Court is directing the respondents to collect the 15% of the penalty alone and the petitioner shall pay the 15% penalty within four weeks from the date of receipt of the order. On such payment the respondents shall conclude the proceedings in respect of the notice as stated in section 74. Petition allowed.
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