GST Summary Assessment Order Set Aside as the order passed on last minute on the last day of the extended time limit
Summary in Key Points:
- Issue: Whether a summary assessment order passed under Section 64 of the GST Act is valid when it appears to have been made without proper consideration of the assessee’s reply and was passed at the last minute on the last day of the extended time limit.
- Facts: The assessee challenged an adjudication order passed based on an audit report, where the authority deemed the assessee’s reply unacceptable due to insufficient documentary evidence. The assessee argued that the order was passed without proper consideration and at the last minute (23:32 hours) on the last day of the extended time limit.
- Decision: The High Court set aside the summary assessment order, holding that it was passed without proper application of mind and granted the assessee an opportunity for a hearing.
Decision:
The High Court ruled in favor of the assessee, setting aside the impugned order. The court emphasized the following:
- Lack of Application of Mind: The order appeared to have been passed without proper consideration of the assessee’s reply and supporting documents.
- Last-Minute Decision: The timing of the order, passed at the very end of the extended deadline, raised concerns about the thoroughness of the assessment process.
- Right to be Heard: The court recognized the assessee’s right to be heard and present their case before a final decision is made.
- Opportunity for Hearing: The court granted the assessee an opportunity to obtain a date for a hearing and present their case before the authorities.
Important Note: This case highlights the importance of conducting a thorough assessment and providing a fair opportunity of hearing to the assessee, even in summary assessment procedures. The High Court’s decision emphasizes that assessment orders cannot be passed mechanically or without proper consideration of the assessee’s submissions. This ensures fairness and transparency in the assessment process and protects the rights of taxpayers.
HIGH COURT OF ORISSA
Alom Extrusions Ltd.i
v.
Chief Commissioner of CT and GST, Odisha
Arindam Sinha and M.S. Sahoo, JJ.
WP(C) No.29659 of 2024
JANUARY 3, 2025
R.P. Kar, Sr. Adv., A.N. Ray and Ms. Z.M. Wallace, Advs. for the Petitioner. S. Mishra (Standing Counsel) and A. Kedia, (Jr. Standing Counsel) Advs. for the Respondent.
ORDER
1. Mr. Kar, learned senior advocate appears on behalf of petitioner and submits, under challenge is order dated 31st December, 2023. Purported adjudication was on allegations based on audit report. He draws attention to discussion and findings in the order to submit, non-application of mind is apparent therefrom. Relied upon passage is reproduced below.
“Reply of the taxpayer filed on 27.10.2023 is not acceptable as it is not supported by sufficient documentary evidence. Further the taxpayer has an opportunity for filing rectification of this order within three months from the issue of order as per section 161 of the CGST/OGST Act, 2017.”
He points out, the order was made at 23:32 hours on 31st December, 2023, the last date in the extended time for making of it.
2. Mr. Mishra, learned advocate, Standing Counsel appears on behalf of State revenue and Mr. Kedia, learned advocate, Junior Standing Counsel, for Central revenue.
3. Mr. Mishra submits, petitioner has itself disclosed it had preferred appeal belatedly. On dismissal thereof it has now moved Court. However, on query from Court, Mr. Mishra submits, he cannot improve on impugned order. We accept submission made on behalf of petitioner that it is apparent there was non-application of mind. There is indication it was so considering the time it was made on the last date of the extended time.
4. In the circumstances, we think fit to interfere.
5. Impugned order is set aside and quashed.
6. Mr. Kar submits, there be direction for his client being given further opportunity of hearing. On query made he points out from impugned order that the authority had impliedly given that opportunity by indicating that the tax payer has opportunity for filing for rectification. We accept this submission as well since an order without reasons would not have anything for rectification.
7. Petitioner will communicate certified copy of this order to the authority by 17th January, 2025. On the communication petitioner will be entitled to obtain date of hearing, for the authority to pass order afresh. In event of omission to communicate as directed, impugned order will stand restored.
8. The writ petition is disposed of.