Introduction

The Hon’ble Madras High Court, in the case of Amarjyothi Carrying Corporation v. Assistant Commissioner (ST) [W.P. No.7143 of 2024 dated March 20, 2024], addressed the entitlement of an assessee to a personal hearing opportunity after the passing of an assessment order, particularly when tax amounts have already been appropriated from the bank account.

Facts of the Case

Amarjyothi Carrying Corporation (“the Petitioner”) filed a writ petition challenging an order dated July 28, 2023 (“Impugned Order”) from the Revenue department (“the Respondent”). The Petitioner claimed that a reasonable opportunity was not provided prior to the issuance of the Impugned Order. It was noted that while filing GSTR 1, the Petitioner failed to indicate GST leviable on a reverse charge basis, an error subsequently rectified in the GSTR 3B return and annual GSTR 9 return. The Petitioner asserted that they were unaware of the proceedings until the Impugned Order was passed. The Respondent had appropriated the entire amount of tax liability from the Petitioner’s bank account.

Issue

Whether the Petitioner is entitled to a personal hearing opportunity after the passing of the Impugned Order due to discrepancies in the return when the amount of tax payable has been appropriated.

Held

The Hon’ble Madras High Court in W.P. No.7143 of 2024 held:

The Court opined that since the amount of tax payable under the Impugned Order had been appropriated from the Petitioner’s bank account, the interests of the Respondent were fully secured. Thus, it was deemed necessary to provide the Petitioner an opportunity for a personal hearing. Consequently, the Impugned Order was quashed, and the matter was remanded for reconsideration. The Court directed the Respondent to provide a reasonable opportunity for personal hearing to the Petitioner and issue a fresh order within a period of two months.