An order in original dated 30.10.2023 is challenged on the ground that the petitioner did not have a reasonable opportunity to contest the tax demand on merits.

An order in original dated 28.09.2023 is assailed on the ground that the petitioner`s reply to the show cause notice was not taken into consideration. Upon receipt of show cause notice dated 27.04.2023 alleging mismatch between the petitioner`s GSTR 3B returns and the GSTR 1 statement as well as between the petitioner`s GSTR 3B returns and the auto-populated GSTR 2A, the petitioner replied on 26.05.2023. The impugned order was issued in these facts and circumstances on 28.09.2023. In spite of the petitioner`s GSTR 1 statement and the annual return in GSTR 9 being available, no reasons are specified as to why the petitioner`s explanation was rejected. Even with regard to the discrepancy between the petitioner`s GSTR 3B returns and the auto-populated GSTR 2A, in spite of the petitioner enclosing the relevant invoices to explain the discrepancy, the impugned order does not discuss the explanation and record reasons for rejecting the same. Consequently, the impugned order cannot be sustained.

The writ petition sought direction for the respondent to pay Rs. 25,86,31,593/- towards GST liability on a construction project. The petitioner, a contractor, claimed GST reimbursement as per agreement terms. The respondent argued against writ jurisdiction, citing arbitration clause and alternative legal remedies. The court noted factual disputes and directed arbitration invocation within four weeks, disposing of the petition without costs.*

Heard Mr. D. Saraf, learned counsel for the petitioner. Also heard Mr.S.C.Keyal, learned Standing Counsel, CGST and Mr. B. Chowdhury, learned Standing Counsel, SGST and Ms. B. Sarma, learned CGC.

The petitioner appears to be a Government contractor, who had rendered service to the Government Departments. It appears that the petitioner had paid the tax, although a portion of the tax payable by the petitioner was deducted by the concerned department and was reflected in Form GSTR-07 under Rule 61 of the TNGST Rules, 2017 read with Section 15 of the TNGST Act, 2017. Later, the department realised that the petitioner had not paid tax and had recovered the amount from the petitioner and acknowledged the same in DRC 03 dated 08.08.2022.

In the case at hand, the refund rejection order was issued on 19.03.2021 and the appeal was lodged on 18.06.2021. As such, the appeal was filed within time limit prescribed by statute. In those circumstances, the ratio of PKV Agencies is applicable. Therefore, this writ petition is disposed of by directing the first respondent to process the appeal by not rejecting the same on the ground that the physical copy of the impugned order was filed on 02.02.2024. If the appeal is otherwise in order, the first respondent is directed to number the appeal within one month from the date of receipt of a copy of this order.

The case of the petitioner is that the petitioner had sufficient amount in the electronic credit ledger and therefore, the petitioner need not be visited in person. A query as to whether the petitioner failed to pay monthly tax as is contemplated. The learned counsel for the petitioner would submit that the amount was not reflected in the regular return filed by the petitioner in GSTR-3B as no amount received and that the amount was later accounted for after the payment of the tax. The amount has already been recovered from the petitioner on 08.08.2022 as it is evident from Form GST DRC -03, this Court is inclined to give liberty to the petitioner to file statutory appeal on merits and in accordance with law within a period of 30 days from the date of receipt of a copy of this order.

While noticing that a common order is passed with respect to the financial years 2017-18 and 2018-19, taking note of the contention that the petitioner was not granted an opportunity as contemplated under Section 75 (4) of the KGST Act when the order passed seems to be adverse to the interest of the petitioner, it would meet the ends of justice by setting aside the order on the ground that the petitioner is afforded an opportunity of hearing and to remit the matter back for fresh consideration before respondent No. 1.

The petitioner challenged the order dated 02.05.2023, on the ground that they were not given sufficient opportunity to explain the discrepancies. The court observed that there is discrepancy between the ITC claimed as per GSTR-3B and GSTR-2A. Circular No. 183/15/2022-GST dated 27.12.2022 is made applicable specifically with respect to the financial year 2017-18 and the same is applicable to the present facts. The Hon’ble High Court set aside the order and remitted the matter back for fresh consideration.

The tax proposal pertains entirely to non payment of tax under reverse charge mechanism. Learned counsel for the petitioner pointed out that such tax proposal was a result of the petitioner making an inadvertent error while filling up GSTR 3B returns. In these circumstances, albeit by putting the petitioner on terms, it is just and necessary that the petitioner be provided an opportunity to contest the tax demand on merits.

In the case at hand, the refund rejection order was issued on 19.03.2021 and the appeal was lodged on 18.06.2021. As such, the appeal was filed within time limit prescribed by statute. In those circumstances, the ratio of PKV Agencies is applicable. Therefore, this writ petition is disposed of by directing the first respondent to process the appeal by not rejecting the same on the ground that the physical copy of the impugned order was filed on 02.02.2024. If the appeal is otherwise in order, the first respondent is directed to number the appeal within one month from the date of receipt of a copy of this order.

The petitioner challenged the appellate order rejecting the appeal against cancellation of the petitioner`s GST registration and also such order of cancellation. The Hon’ble High Court disposed the matter on similar lines, as decided in the matter of Suguna Cutpiece.