Hatsun Agro Product Ltd Vs Deputy Commissioner (State Tax)
Date: June 14, 2023
Subject Matter
Details relied upon for crystallisation of demand u/s 73 ought to be included in the SCN
Summary
The Madras High Court set aside an assessment order based on general notices that were issued to the taxpayer. The order in question was issued under Section 73 of the Tamil Nadu Goods and Services Tax Act, 2017, and dealt with the reversal of Input Tax Credit (ITC) claimed by the taxpayer. The Assessing Officer determined the amount of ITC to be reversed by comparing the ITC claimed under GSTR 3B and GSTR 2B. The court held that this determination should have been included in the show cause notice given to the taxpayer before issuing the assessment order. As a result, the assessment order was set aside, and the taxpayer was directed to appear with all necessary details to support their claim of ITC reversal on a specified date.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
Mr. V. Prashanth Kiran, learned Government Advocate accepts notice for the respondents and is armed with instructions to enable a final disposal of this matter, even at the stage of admission.
2. The impugned order is one of assessment dated 17.03.2023, passed under the provisions of the Tamil Nadu Goods and Services Tax Act, 2017 (in short ‘Act’). The issue relates to reversal of Input Tax Credit (ITC), which, in the opinion of the Assessing Officer is ineligible and ought not to have been claimed.
3. Prior to the impugned order, which is a culmination of proceedings for assessment under Section 73 of the Act, the Assessing Authority had issued notices in DRC-01A and ASMT -10 calling for identical particulars as were required for the presnt impugned proceedings as well.
4. While it is the petitioner’s case that those particulars have been supplied, learned Government Advocate would submit that the particulars have to be supplied in a tabulation that was specifically put to the petitioner.
5. To be noted, the manner in which the respondent has sought the information along with supporting particulars incuding invoices is clearly set out in communication dated 09.09.2022 as follows:
Inward Supplies – (GSTR 2B Vs. GSTR -3B):
| ITC AS PER GSTR-3B | ITC AS PER GSTR-2B | DIFFERENCE | |||||||||
| IGST | CGST | SGST | CESS | IGST | CGST | SGST | CESS | IGST | CGST | SGST | CESS |
| 42,11, | 23, 38, | 23, 38, | 68, 814 | 87, 50, | 61, 71, | 61, 71, | 94, 27, | 45, 38, | 38, 32, | 38, 32, | 93, 58, |
| 50, 343 | 28, 698 | 28, 698 | 22, 741 | 05, 196 | 05, 195 | 162 | 72, 398 | 76, 498 | 76, 497 | 348 | |
Further, the tax payer is requested to furnish the details of Input Tax Credit availment for the year 2021-22 as detailed below:
a) Categorisation of ITC
| Month | ITC AS PER GSTR 2B | Eligible ITC in GSRT-2B | Not eligible ITC | ||||||
| SGST | CGST | IGST | SGST | CGST | IGST | SGST | CGST | IGST | |
b) Eligible ITC
| HSN | Inward supply value | Taxes paid | ||||
| Intra State | Inter State | Import | SGST | CGST | IGST | |
c) In eligible ITC
| GSTIN | Inward supply value | Tax paid |
6. It is unclear as to whether the particulars have been supplied in this specific manner and whether the entirety of the supporting documents have been produced before the Assessing Officer.
7. However, a perusal of the impugned order makes it clear that it is only in paragraph 5 onwards that the Assessing Officer has embarked on the determination/crystallisation of the amount to be reversed on a comparison of the ITC claimed under GSTR 3B and GSTR 2B.
8. This determination, in the considered view of the Court, ought to have been put to the petitioner in the show cause notice itself prior to passing of the impugned order, such that the petitioner had been afforded sufficient opportunity to respond the same and, or provide details in support of the claim of ITC.
9. Prior to the impugned order of assessment, what was exchanged was only general notices calling for particulars to which the petitioner is seen to have responded, albeit, insufficiently.
10. Thus, and in the interests of substantial justice, impugned order of assessment dated 17.03.2023 is set aside and shall be treated as a show cause notice by the petitioner, who shall appear along with all details in support of the reversal under the impugned order on Thursday, the 13th July, 2023, at the specific request of the learned counsel for the petitioner, without expecting any further notice in this regard.
11. Though this Court is reluctant to fix such a long date of hearing, the request of learned counsel for the petitioner is acceded to, as the authorised representative is stated to be a super senior citizen, who is 84 years old and it is in consideration of the same that the matter is fixed on 13.07.2023. No adjournment shall be sought on that day and if the petitioner does not appear on that day along with the supporting materials, the benefit granted under this order shall stand withdrawn without further reference to the petitioner.
12. After hearing the petitioner and consideration of materials, if any supplied in support of the show cause notice, let an order be passed within a period of six (6) weeks from date of personal hearing, i.e., on or before 25.08.2023, in accordance with law.
13. This Writ Petition stands disposed as above. No costs. Connected Miscellaneous Petitions are closed.