2023 (8) TMI 168 - HC - GST

Time Limitation for filing rectification application - it is alleged that rectification application filed beyond period of limitation - rectification application under section 161 of TNVAT Act filed but opportunity of personal hearing not given - Validity of assessment order - Transition of credits - inadvertently specified the CENVAT credit accrued on purchase of inputs under TNVAT Act - HELD THAT - It is seen from the records that the assessment order was passed on 06.01.2020 and the rectification application ought to have been filed on or before 06.04.2020. However, the period from 15.03.2020 to 06.04.2020 ought to be excluded based on the suo motu extension order. Then the 90 days ought to be calculated from 01.03.2022, wherein the time is available until 30.05.2022, but the petitioner had filed the application on 02.09.2020 itself, which is within the period of limitation. Therefore, the impugned order stating that the rectification application is filed beyond the period of limitation is incorrect. Reliance placed in TVL. SHANDONG TEIJUN ELECTRIC POWER ENGINEERING COMPANY LTD. VERSUS THE STATE TAX OFFICER, CHIDAMBARAM 2022 (3) TMI 542 - MADRAS HIGH COURT where it was held that It is brought to the notice of this Court by the learned counsel for the petitioner in respect of the limitation, there could be no much quarrel from respondent side also as these all are the materials on records. Therefore, the limitation insofar as the petitioner is concerned, is saved by the orders of the Hon'ble Supreme Court of India, hence, on that ground mainly if the rectification application is rejected through the impugned order, the same shall not stand in the legal scrutiny. This Court is inclined to allow this writ petition and the impugned order is quashed. Consequently, the respondent is directed to reconsider the case of the petitioner in the light of the Section 161 of the GST Enactments by granting opportunity of personal hearing and the said exercise shall be completed within a period of eight weeks from the date of receipt of the copy of the order. Petition allowed.

Summary

Issues involved:
The writ petition challenges the Assessment order based on the petitioner's entitlement to transition credits under section 140 of GST enactments and the rectification application filed under section 161.

Challenge to Assessment Order:
The petitioner claimed entitlement to transition credits under section 140 of GST enactments, but inadvertently specified the CENVAT credit under TNVAT Act in the wrong column of Form TRAN-1. The respondent issued a notice stating no ITC was available under TNVAT, leading to the rejection of the credit in TRAN-1. The petitioner filed a rectification application under section 161, which was rejected on grounds of limitation and error not being self-evident. The respondent rectified the assessment order, reducing the penalty to Rs.10,000 without a personal hearing for the rectification application.

Rectification Application under Section 161:
The petitioner argued that the rectification application was filed within the extended time period as per the order of the Hon'ble Supreme Court, making it within the limitation period. Citing a previous judgment, the petitioner contended that the limitation issue was saved by the Supreme Court's orders, and the rectification application should be considered independently. The Court agreed, setting aside the impugned order and remitting the matter back to the respondent for reconsideration, emphasizing the independent nature of the decision-making process and granting a personal hearing to the petitioner.

Judgment Outcome:
The Court allowed the writ petition, quashed the impugned order dated 09.03.2023, and directed the respondent to reconsider the petitioner's case in light of Section 161 of the GST Enactments and the Hon'ble Supreme Court's judgment. The respondent was instructed to provide a personal hearing and complete the reconsideration process within eight weeks. The writ petition was allowed with no costs incurred.