Madras High Court Quashes GST Order Issued U/S 63 Due to Lack of Opportunity to Respond

The Madras High Court has set aside assessment orders issued u/s 63 of the Goods and Services Tax ( GST ) Act, 2017, and the cases were remanded for reconsideration. The writ petitions contested the orders enacted via the Deputy State Tax Officer and the Deputy Commercial Tax Officer of Mettur Circle.

Annalakshmi Stores, the applicant, argued that the tax assessments for 2017-18, 2018-19, 2019-20, and 2020-21. The GST applicant’s registration was canceled dated February 8, 2019, with retrospective effect from August 31, 2017, because of continuous non-filing of returns for 6 months. The applicant claimed unawareness of the notice issued in Form GST ASMT-14 because it was uploaded via a temporary ID.

The applicant, represented by G. Vardini Karthik, claimed that issuing the SCN in Form GST ASMT-14 is obligatory under Section 63 of the applicable GST enactments and Rule 100 of the TNGST Rules. The counsel asserted that uploading the notice on a temporary ID did not form proper service u/s 169 of the applicable GST legislation. The applicant learned that they had remitted 10% of the disputed tax demand but could not file statutory appeals due to the temporary ID issue.

Harsha Raj, the Additional Government Pleader, claimed that the original email ID and mobile number of the applicant were used to make the temporary ID, and the password was communicated to these contact points. Consequently, the applicant had access to the temporary ID and the notices.

On the effective judgment basis, the tax liability was computed using auto-populated GSTR-2A data without hearing the petitioner in person. The court acknowledged the necessity for the petitioner to contest the tax proposal on merit, Justice Senthilkumar Ramamoorthy noted.

The Madras High Court ordered that the impugned assessment orders be set aside, given the applicant remits 10% of the disputed tax demand for each assessment period within 2 weeks. The applicant was allowed to apply for a refund, remitted previously amounts under the old registration, to be processed within 30 days.

The court sought the first respondent to propose to the applicant a reasonable chance along with the personal hearing before issuing the fresh orders within 3 months from the receipt of the response from the applicant.

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The writ petitions were disposed of without cost, and the corresponding miscellaneous petitions were closed.