Madras HC Removes GST Assessment as Short Time Was Given to Assessee to Reply SCN

The Madras High Court has rejected the assessment since the assessee was given only 13 hours to respond to the show-cause notice.

The bench of Justice M. Dhandapani instructed that the department must reevaluate the matter afresh, after giving the petitioner an option, to issue any necessary directives within a four-week timeframe.

The petitioner received a first show cause notice on March 6, 2023, and was given the time of 13 hours to respond which was until March 9, 2023. On March 9, 2023, the petitioner responded along with the bank statements and information about the car sales. On March 25, 2023, at 10.45 a.m. The petitioner once more submitted a response, requesting further time to submit copies of the purchase and sales bills as well as the PAN information of the dealers to whom the products were sold.

The second show cause notice suggested that the assessee evaluate the difference on March 27, 2023, at 19.10.33 PM, instead of providing the details and expecting time to create and upload the bulky records. Only 13 hours were given to the petitioner until March 28, 2023, at 9:00 a.m. The postponed application that the petitioner submitted on March 25, 2023, in the portal, was rejected considering the assessment deadline of March 31, 2023. The department approved the order.

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According to the petitioner, the writ petition has been filed by the petitioner only for the limited point that the defendant did not give the petitioner the option to file a detailed explanation. The second show cause notice intending to evaluate the difference was issued to the petitioner on March 27, 2023, at 19.10 p.m., and the petitioner was given only 13 hours to reply, i.e., until 9.00 a.m. on March 28, 2023. It is a direct breach of the principles of natural justice since, in the duration of the night hours, the petitioner will not be in a situation to respond.

The petitioner received a second show cause notice on March 27, 2023, at 19:10 p.m., and the time that has been given to respond was until 9:30 a.m. on March 28, 2023, which was a direct breach of natural justice principles, noted the court.