The Madras High Court granted the petitioner the opportunity to contest a Goods and Services Tax ( GST ) demand, provided they make a 10% pre-deposit. This decision arised from a situation where the petitioner’s accountant overlooked GST notices uploaded in the “view additional notices and orders” tab on the GST portal.

The petitioner challenged the  order dated 31.07.2023 on grounds of being denied a reasonable opportunity to present their case. It was argued that they were unaware of the proceedings leading to the order as their GST compliances were handled by an accountant who failed to check the “view additional notices and orders” tab on the GST portal. The petition was filed in light of these circumstances. The Counsel for the petitioner emphasised that the tax proposal in question concerned credit notes issued by suppliers, and that the Input Tax Credit was availed net of the value of these credit notes.

They expressed confidence that given the opportunity, the petitioner could clarify the discrepancy to the respondent. It was agreed that the petitioner would remit 10% of the disputed tax demand as a condition for remand. The Government Advocate representing the respondent accepted notice and pointed out that proceedings were initiated against the petitioner through a series of notices, including Form ASMT 10, a show cause notice dated 20.06.2023, and a personal hearing notice dated 27.07.2023.

Upon examination of the impugned order, it was revealed that the tax proposal arised from the alleged failure of the petitioner to reverse Input Tax Credit to the extent of credit notes issued by suppliers. However, the petitioner contended that Input Tax Credit was indeed availed net of the value of these credit notes. Given these circumstances, the court deemed it just and necessary to afford the petitioner an opportunity, albeit with certain conditions.

A Single bench of Justice Senthilkumar Ramamoorthy set aside the impugned order dated 31.07.2023 on the condition that the petitioner remits 10% of the disputed tax demand within two weeks from the date of receipt of the court’s order. Within this timeframe, the petitioner was also permitted to submit a reply to the SCN. Upon receipt of the reply and satisfaction that 10% of the disputed tax demand was remitted, the respondent was directed to provide a reasonable opportunity for a personal hearing and issue a fresh order within three months.