The show cause Notice and detailed notice, it was clear that the detailed notice deals with nine tax proposals

The Madras High Court remanded the matter for reconsideration due to the failure of an accountant to inform the client of a Goods and Service Tax ( GST ) demand notice. An order in original dated 31.01.2024 in respect of assessment period 2018-2019 was  challenged both on the ground that the petitioner did not have a reasonable opportunity to contest the tax demand on merits and on the ground that the impugned order travels beyond the scope of the show cause notice. An intimation dated 13.09.2023 was issued to the petitioner in respect of about nine defects. This was followed by a show cause notice dated 10.10.2023. The show cause notice also dealt with the above mentioned nine defects in the detailed notice. The petitioner asserts that he was unable to participate in proceedings by responding to the above on account of his Accountant not informing him about the proceedings. The present writ petition was filed in the said facts and circumstances Mr.B.Sivaraman, representing the petitioner, referred to the show cause notice in Form DRC-01 and pointed out that the tax proposal is for an aggregate sum of Rs.1,32,42,139/-. He points out that the detailed notice travels beyond the scope of the summary. By comparing the detailed notice to the impugned order, he points out that even the detailed notice did not refer to interest or penalty liability, whereas the impugned order imposes such liability. Mr.C.Harsha Raj, representing the Additional Government Pleader, accepted notice for the respondent. He points out that these proceedings arose out of an inspection conducted in March 2023. He also submits that principles of natural justice were complied with by issuing intimation dated 13.09.2023, show cause notice dated 09.10.2023 and two reminders.  It was clear that the detailed notice deals with nine tax proposals. The said nine tax proposals correspond to those specified in the earlier intimation. It is, however, noticeable that there was no proposal with regard to interest and penalty. In the impugned order, penalty was imposed at 10%. Thus, as regards interest and penalty, the petitioner did not have an opportunity to respond to the proposal. For such a reason, the order calls for interference. Since the petitioner did not respond in spite of several opportunities being provided, it is just and appropriate that the petitioner be put on terms. On instructions, learned counsel for the petitioner agrees to remit 10% of the disputed tax demand as a condition for remand. The single bench of Justice Senthil Kumar Ramamoorthy observed that the impugned order dated 31.01.2024 shall be treated as a show cause notice and the petitioner is permitted to respond thereto within four weeks from the date of receipt of a copy of this order. The petitioner shall also remit 10% of the disputed tax demand within the aforesaid period. Upon receipt thereof and on being satisfied that 10% of the disputed tax demand was received, the respondent is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and thereafter issue a fresh order within a period of three months from the date of receipt of the petitioner’s reply. Accordingly, the writ petition was disposed of.