Issuance of Form ASMT-10 notice is mandatory during the scrutiny of returns

Last updated: 24 September 2024

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The Madras High Court has ruled that issuing a notice in Form GST ASMT-10 is a mandatory step when discrepancies are found during the scrutiny of GST returns. Failure to issue this notice can invalidate the findings from the scrutiny process, although it does not necessarily invalidate the entire adjudication if the taxpayer was given a chance to respond. The court set aside previous orders in two cases due to procedural errors, remanding one for reconsideration with an opportunity for the petitioner to submit further replies and receive a personal hearing.

Court :
Madras High Court

Brief :
The Hon'ble Madras High Court in M/s Mandarina Apartment Owners Welfare Association v. Commercial Tax Officer/State Tax Officer [Writ Petition No.15307 & 15330 of 2024 dated July 16, 2024] held that the show cause notice lacked reference to scrutiny under Section 61 of the Central Goods and Services Tax Act, 2017. Instead, it cited data from GSTR-01 and GSTR-3B returns, highlighting discrepancies. Both the notice and the impugned order referred to a scrutiny under Section 61, fulfilling the conditions for issuing an ASMT-10 notice. The failure to issue the ASMT-10 rendered the scrutiny's conclusions invalid for adjudication. However, since the petitioner was given an opportunity to show cause, adjudication was not solely based on scrutiny under Section 61, and no prejudice was caused. The matter was remanded for reconsideration.

Citation :
Writ Petition No.15307 & 15330 of 2024 dated July 16, 2024]

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