Assessee should be granted opportunity of personal hearing

The Hon'ble Madras High Court in Haarine Associates v. Assistant Commissioner (ST)(FAC) [Writ Petition No.15691 of 2024 and W.M.P.Nos.17100 to 17102 of 2024 dated June 24, 2024], set aside an assessment order because the order was issued without providing an opportunity to address the discrepancies. Consequently, the court agreed with the Assessee to remit 10% of the disputed tax demand within two weeks and allowed the submission of reply to the show cause notice ("the SCN").

Facts

M/s. Haarine Associates ("the Petitioner"), filed returns for the assessment period 2017-18.

The Petitioner's FORM GSTR 1 statement, FORM GSTR 3B and the annual return reflected the turnover from July 01, 2017 to March 31, 2018. Subsequently, FORM ASMT-10 was issued on July 05, 2023. Thereafter, on August 07, 2023 a SCN was served and personal hearing was conducted on September 15, 2023.

The Petitioner contended that the period from April 01, 2017 to June 30, 2017 was the pre-GST period, he submits that there would be a mismatch between FORM 26 AS and the petitioner's GST returns. Merely on the basis of such mismatch, that tax liability was imposed on the Petitioner. Further, the Petitioner agreed to remit 10% of the disputed tax demand as a condition for remand.

Lastly, an Assessment Order dated December 28, 2023 ("the Impugned Order") was passed.

Aggrieved by the Impugned order, the Petitioner filed the present writ petition on the ground of breach of natural justice and no application of mind.

Issue

Whether the Assessee should be granted opportunity of personal hearing?

Held

The Hon'ble Madras High Court in Writ Petition No.15691 of 2024 and W.M.P.Nos.17100 to 17102 of 2024held as under:

• Directed that, the Petitioner is permitted to submit a reply to the SCN and directed the Respondent to provide a reasonable opportunity to the Petitioner, including a personal hearing, and thereafter issue a fresh order within a period of three months from the date of receipt of the petitioner's reply. On account of the Impugned Order being set aside.
• Held that, the Impugned order was set aside subject to the condition that the Petitioner remitted 10% of the disputed tax demand as agreed to within a period of two weeks from the date of receipt of a copy of the Impugned Order.

OFFICIAL JUDGMENT COPY HAS BEEN ATTACHED