Facts of the Case

The petitioner, Tvl. Diamond Shipping Agencies Private Limited (trade name Diamond Global Forwarder), challenged an assessment order dated 17.08.2022 for the tax period 2017-18 under GSTIN 33AAACD6487H3ZJ, communicated through Form GST DRC-07 (Reference No. ZD330822011579E). The petitioner operates three business verticals under the same PAN, and contended that the assessment order was passed without considering the annual returns filed in GSTR-9 and the reconciliation statements filed in GSTR-9C for those three verticals. It was further contended that the order was passed without physical service of the notice/order as required by the Act.

Issues Involved

  1. Whether the assessment order was validly served in accordance with Section 169(1)(b) of the CGST/TNGST Act.
  2. Whether the assessing authority erred in passing the order without considering the GSTR-9 and GSTR-9C filings relatable to the petitioner's three business verticals.

Petitioner's Arguments

  • The assessment order was passed violating the principles of natural justice, as the respondent failed to consider the GSTR-9 annual returns and GSTR-9C auditor's statements filed for the three separate business verticals operating under the same PAN.
  • The order was passed without physical service of notice/order, contrary to Section 169(1)(b) of the Act, and if given an opportunity, the petitioner could explain the discrepancies to the authorities.

Respondent's Arguments

  • No specific contest to the petitioner's factual submissions is recorded; the impugned order was defended on the record as passed.

Court Order / Findings

  • The Court held that the impugned order was passed without serving notice as required under Section 169(1)(b) of the Act and without taking into account that the petitioner operates three business verticals, and accordingly quashed the impugned order.
  • The respondent was directed to grant the petitioner an opportunity, preferably a personal hearing, and thereafter pass fresh orders, with the petitioner directed to produce all evidence and documents before the respondent.
  • The respondent was directed to complete the assessment proceedings within a period of eight weeks from the date of receipt of a copy of the order.

Important Clarification

An assessment order passed without complying with the mandatory mode of service prescribed under Section 169(1)(b) of the GST Act, and without accounting for annual returns and reconciliation statements filed for all of an assessee's registered business verticals under a common PAN, is liable to be quashed and remanded for a fresh, properly served assessment after personal hearing.

Case Details

  • Court: Madurai Bench of Madras High Court
  • Case Number: W.P.(MD).No.6874 of 2023
  • CNR / Citation: W.P.(MD).No.6874 of 2023
  • Coram: Hon'ble Mrs. Justice S. Srimathy
  • Date of Order: 29 August 2023

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