The Hon'ble Madras High Court in the case of Southern Engineering Services vs Deputy State Tax Officer, [Writ Miscellaneous Petition Nos. 7251 AND 7252 OF 2024 dated March 14, 2024] held that the impugned order dated November 21, 2023, assessing tax on the zero-rated supply made by the Petitioner, is quashed. The matter is remanded for reconsideration by the assessing officer.
Facts:
M/s Southern Engineering Services (“the Petitioner”) supplied services to Dell International Services India Private Limited, an SEZ unit, in July 2017 without charging GST as it was a zero-rated supply. While filing the GSTR-1 return, the Petitioner inadvertently reported the turnover under the taxable value column. However, in the GSTR-3B return filed for the same period, it was correctly reported as a zero-rated supply not attracting GST. Revenue Department (“the Respondent”) issued the impugned order dated November 21, 2023 ("the Impugned Order"), assessing tax on the Petitioner. The Petitioner contended that the notices and the impugned order were uploaded in the "view additional notices and orders" tab of the GST portal, and they could not participate in the proceedings.
Aggrieved by the impugned order, the Petitioner filed the present writ petition.
Issue:
Whether the impugned order, assessing tax on the zero-rated supply made by the Petitioner, is valid?
Held –
The Hon'ble Madras High Court in Writ Miscellaneous Petition Nos. 7251 AND 7252 OF 2024 held as under:
· Observed that, the tax invoice prima facie indicated that the supply was made to an SEZ unit, qualifying it as a zero-rated supply. The GSTR-3B return of the Petitioner was in line with the supply being zero-rated. The Court further noted that the supply pertained to the July quarter of the assessment period 2017-18, which was during the nascent stage of GST implementation.
· Opined that, it was an appropriate case to provide an opportunity to the Petitioner. The Hon'ble Court held that the impugned order is quashed, and the matter is remanded for reconsideration by the assessing officer.
· Directed that, the Petitioner to submit a reply to the SCN within 15 days from the date of receipt of the order, enclosing all relevant documents. Upon receipt, the assessing officer was directed to provide a reasonable opportunity to the Petitioner, including a personal hearing, and thereafter issue a fresh assessment order within two months.
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