In the matter of Asia (Chennai) Engineering Vs Assistant Commissioner (ST) (FAC)
In a recent pivotal decision, the Madras High Court has addressed the requirement of filing a reply to a show-cause notice under various sections of the GST Act. The court ruled that submitting a reply in the form GST-DRC-06 is not mandatory under Section 73(9), 74(9), and 76(3) of the GST Act. Additionally, the court emphasized that a reply sent through postal means should also be considered valid.
The case involved Asia (Chennai) Engineering Company Private Limited, which sent a physical representation on 08.01.2022, received by the authorities on 10.01.2022. However, the petitioner was denied an opportunity for a hearing. Justice M. Nirmal Kumar highlighted that the department should have referred to and considered the representation before providing the petitioner with an opportunity to explain. The court asserted that failure to consider the representation amounted to a denial of the petitioner’s right to opportunity and breached principles of natural justice.
Addressing the department’s objection that the physical reply was not submitted through the portal, the court insisted that the petitioner deserves a personal hearing to present their objections. Given the nature of the case involving an erroneous refund, the court deemed it appropriate for a personal hearing to be conducted. It directed the department to provide the petitioner with an opportunity for a personal hearing, during which the objections and submitted documents should be thoroughly examined.
The court, while refraining from delving into the merits contested by both parties, acknowledged that the petitioner had submitted a detailed representation dated 07.01.2022, received by the respondents on 10.01.2022. It reiterated the importance of a personal hearing in such cases and emphasized the need for due consideration of all documents and objections raised.
Consequently, the Madras High Court allowed the petition, directing the department to provide an opportunity for a personal hearing, hear the objections, and carefully review the submitted documents and explanations. The court’s decision serves as a reminder of the principles of natural justice and the importance of fair procedures in dispute resolution under the GST Act.