ARSK Hardwares And Traders VS State Tax Officer

Several Writ Petitions have been filed seeking the issuance of a Writ of Certiorari. The petitioners aim to review and annul the assessment orders issued by the first respondent in relation to GSTIN numbers 33ANPR8730L129/2017-18, 33ANPR8730L129/2018-19, and 33ANPR8730L129/2019-20, respectively dated February 7, 2020. The petitioners argue that these orders are inherently illegal, alleging violations of the principles of natural justice and non-compliance with the provisions stipulated under the Tamil Nadu Goods and Services Tax Act, 2017.

The writ petitions in question seek the issuance of a Writ of Certiorari to review and annul the assessment orders made by the first respondent under GSTIN for the periods 2017-18, 2018-19, and 2019-20, dated 07.02.2020, on grounds of being illegal, violating principles of natural justice, and contravening the provisions of the Tamil Nadu Goods and Service Tax Act, 2017.

The petitioner, proprietor of ARSK Hardwares & Traders in Madurai, had their business premises inspected by the first respondent on 30.10.2019 and 01.11.2019. Subsequently, on 04.11.2019, the first respondent requested GSTR 3B & GSTR-1 returns, P&L Accounts, Balance Sheets, Purchase Invoices, Sale Bills, Stock Account Registers, E-Way Bill Transactions, Import-Export details, Bank Statements, and Annual Return GSTR-9 for the relevant tax periods. On 21.11.2019, the first respondent issued a notice pointing out discrepancies.

Petitioner was granted personal hearing on 27.12.2019. Despite submissions made during the personal hearing, the impugned orders of assessment were passed on 07.02.2020 by the first respondent under GSTINs: 33ANPR8730L129/2017-18, 33ANPR8730L129/2018-19, and 33ANPR8730L129/2019-20. The petitioner contends that these orders are ex facie illegal, violate the principles of natural justice, and contravene provisions of the Tamil Nadu Goods and Services Tax Act, 2017.

The case revolves around ARSK Hardwares & Traders, Madurai, owned by the petitioner. The dispute arose from inspections conducted on 30.10.2019 and 01.11.2019 by the first respondent, which identified deficiencies for the tax periods spanning 2017-18 through 2019-20. Subsequently, on 04.11.2019, the first respondent requested various documents including GSTR 3B & GSTR-1 returns, financial statements, purchase invoices, sale bills, stock records, E-Way bill transactions, import-export details, bank statements, and the annual return GSTR-9.

A notice dated 21.11.2019 highlighted discrepancies between GSTR-3B and GSTR-2A, alleged tax rate discrepancies (18% versus 28%), and unverified claims under Reverse Charge provisions of Section 9(3) of TNGST Act and 5(3) IGST Act. The petitioner was instructed to respond within 15 days. Following this, a pre-assessment notice dated 12.12.2019 proposed penalties under Sections 74 and 125, and a personal hearing was conducted on 27.12.2019.

Despite submissions during the hearing, the first respondent proceeded to pass the impugned assessment orders on 07.02.2020. The petitioner argues that these orders are unlawful, citing procedural irregularities and non-adherence to natural justice principles. The petitions seek relief through a Writ of Certiorari to quash the said assessment orders.

These writ petitions seek the issuance of a Writ of Certiorari to review and quash three assessment orders issued by the first respondent under GSTIN: 33ANPR8730L129 for the financial years 2017-18, 2018-19, and 2019-20, dated February 7, 2020. The petitions allege that these orders are illegal, violate principles of natural justice, and contravene provisions of the Tamil Nadu Goods and Services Tax Act, 2017.

The petitioner, proprietor of ARSK Hardwares & Traders in Madurai, underwent inspections of their business premises on October 30, 2019, and November 1, 2019, by the first respondent. Subsequently, on November 4, 2019, the first respondent requested various documents including GSTR 3B & GSTR-1 returns, financial statements, purchase and sale invoices, and other transaction records for the tax periods in question. On November 21, 2019, a notice was issued highlighting discrepancies in GST returns and tax collection rates, and the petitioner was given 15 days to respond.

Further, on December 12, 2019, a pre-assessment notice was issued outlining ten defects and proposing penalties under Sections 74 and 125 of the GST Act. The petitioner was given seven days to respond, leading to a subsequent personal hearing scheduled for January 6, 2020. On that date, the petitioner requested an extension to submit voluminous documents, which was granted, and objections were filed on January 20, 2020, addressing each defect in detail and requesting a personal hearing before any order was passed.

Despite these objections, notices continued to be issued by the first respondent, culminating in a penalty proposal equivalent to tax evaded under Section 122(XV) of the TNGST Act, issued on January 30, 2020. Finally, on February 7, 2020, the impugned assessment orders were passed without considering the objections or granting a personal hearing, prompting the filing of these writ petitions.

In summary, the petitions challenge the legality of the assessment orders, alleging procedural irregularities and a failure to adhere to principles of natural justice during the assessment process.

Mr. B. Sivaraman, counsel for the petitioner, argues that these assessment orders are illegal and fail to comply with principles of natural justice, citing precedents such as SRC Project Private Limited vs. Commissioner of Commercial Taxes, Chennai and Another (2010 33 VST 333) and Shri Mariamma Fire Works vs. Commissioner of Commercial Taxes and Another (2011 (38) VST 345), which emphasize the necessity of granting a personal hearing to assesses.

In conclusion, the petitioners seek judicial intervention to quash the impugned assessment orders and restore procedural fairness in accordance with the law.

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