GST Vidhi | GST Case Law

Case Title: Tamil Nadu Handloom Development Corporation Ltd. vs Deputy State Tax Officer -2 & Union Bank of India

Case Number: W.P.No.26000 of 2024

Date of Order: 4th September 2024

Court: High Court of Judicature at Madras

Judge: Hon'ble Mr. Justice Krishnan Ramasamy

Summary of the Case: The writ petition was filed by Tamil Nadu Handloom Development Corporation Ltd., challenging the assessment order issued by the Deputy State Tax Officer for the financial year 2018-19 under Section 73 of the CGST Act, 2017. The petitioner argued that their reply to the show cause notice was not considered before the impugned order was passed. The court found that there was a lack of application of mind by the respondent and remanded the case for fresh consideration after setting aside the impugned order.

Facts of the Case:

·        Petitioner: Tamil Nadu Handloom Development Corporation Ltd., represented by its Managing Director, Mr. K. Munusamy.

·        Show Cause Notice: Issued on 23rd December 2013, under Section 73 of the CGST Act, for the assessment year 2018-19.

·        Petitioner's Response: The petitioner submitted a reply to the show cause notice on 8th February 2024, which the respondent failed to consider before passing the impugned order on 27th April 2024.

·        Impugned Order: The assessment order demanded tax without considering the petitioner's reply, reflecting non-application of mind by the first respondent.

Submission by Petitioner:

·        The petitioner's counsel, Mr. R. Ananth, argued that the impugned order was passed as though no reply had been filed, despite the petitioner's response on 8th February 2024. This indicated a lack of application of mind.

·        The petitioner had already paid 10% of the tax and requested the court to set aside the order and remand the matter for fresh consideration.

Submission by Respondents:

·        Represented by Additional Government Pleader (Taxes), Mr. C. Harsha Raj, the respondents agreed that the reply would be considered and appropriate orders would be passed within a time frame stipulated by the court.

Findings of the Court:

·        The court found that the petitioner had indeed submitted a reply, which was not considered by the respondent before passing the impugned order. This amounted to non-application of mind by the first respondent.

·        The court deemed it necessary to remand the matter to the respondent for fresh consideration, after setting aside the impugned order.

Judgment:

·        The court set aside the impugned assessment order dated 27th April 2024.

·        The matter was remanded to the first respondent with instructions to consider the petitioner's reply dated 8th February 2024.

·        The respondent was directed to issue a 14-day notice for a personal hearing and pass a fresh order on merits and in accordance with the law.

·        The court also ordered the lifting of the attachment notice dated 27th August 2024.

·        No order as to costs.

Conclusion: The High Court of Madras found that the impugned order was passed without considering the petitioner's reply, amounting to a violation of the principles of natural justice. The court remanded the case back to the respondent for reconsideration, ensuring the petitioner was given an opportunity for a hearing.

 Disclaimer: All the Information is based on the notification, circular and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.