2024 (4) TMI 273 - HC - GST

Violation of principles of natural justice - challenge to assessment orders - Attachment of Bank Accounts of petitioner - HELD THAT - The assessment orders were issued on 31.07.2023 but the petitioner has approached this Court in late February 2024 after the bank accounts of the petitioner were attached. The documents on record clearly indicate that the petitioner was negligent in not contesting the assessment proceedings until orders of attachment were issued. However it is equally clear that the orders impugned herein were issued without hearing the petitioner. In these circumstances solely with the view to provide an opportunity to the petitioner to contest the tax demands interference with the impugned orders is warranted subject to putting the petitioner on terms. Hence the impugned assessment orders are quashed and the matters are remanded for re-consideration subject to the condition that the petitioner remits 12.5% of the disputed tax demand in each assessment order within a period of two weeks from the date of receipt of a copy of this order. The petitioner is also permitted to submit a reply to the show cause notice within a period of three weeks from the date of receipt of a copy of this order. Petition disposed off by way of remand.

Summary

Issues involved:
The petitioner challenges assessment orders for different periods citing breach of natural justice principles.

Details of the judgment:

Issue 1: Breach of principles of natural justice
The petitioner, not well-versed with GST compliances, claims ignorance of the assessment proceedings until bank accounts were frozen. The petitioner argues that Section 74 of the State Goods and Services Tax Act, 2017 was wrongly invoked, and requests an opportunity to present relevant documents to establish genuine Input Tax Credit (ITC) availment.

Issue 2: Assessment process and notices
The respondent, represented by Mr. V. Prasanth Kiran, asserts that the petitioner and another party involved are close relatives. It is highlighted that the petitioner had accessed the GST portal and replied to a notice previously. The assessment order details the issuance of notices, including a show cause notice and three personal hearing notices, indicating that the petitioner was aware of the proceedings.

Issue 3: Court's decision
The Court notes the petitioner's delay in contesting the assessment proceedings but acknowledges the lack of a hearing before issuing the impugned orders. The Court quashes the assessment orders, remanding the matters for re-consideration with the condition that the petitioner remits 12.5% of the disputed tax demand under each assessment order within two weeks. The petitioner is granted three weeks to reply to the show cause notice. The assessing officer is directed to provide a reasonable opportunity for a personal hearing and issue fresh assessment orders within four months.

Separate Judgment:
The Court disposes of W.P.Nos.4795, 4799, 4803, 4813, and 4815 of 2024 with no costs, closing the associated W.M.P.Nos.5231, 5232, 5222, 5223, 5249, 5250, 5252, 5255, 5226, and 5227 of 2024.