In MAT/670/2023- CAL HC - Calcutta High Court sets aside Appellate Authority’s order, remands matter to Assistant Commissioner, SGST, Siliguri with a condition that the Assessee shall pay an additional sum of Rs.1 lakh
Acting Chief Justice S. Sivagnanam & Justice Hiranmay Bhattacharyya [28-04-2023]

Read Order: Mohammad Sikandar Ali V. The Assistant Commissioner, State Tax, Siliguri Charge and Ors

Chahat Varma

New Delhi, May 27, 2023: The Calcutta High Court has set aside the orders passed by the appellate authority and has remanded the matter back to the Assistant Commissioner, SGST, Siliguri, with a condition that the appellant-assessee shall pay a further sum of Rs.1 lakh and upon payment, the assessing officer has been directed to examine whether the assessee was correct in computing the tax at 12%. After considering all the documents and providing the assessee with an opportunity of personal hearing, the assessing officer has been instructed to pass fresh orders on merits and in accordance with the law.

This intra court appeal by the assessee was directed against the order dated 11.04.2023 passed by the Single Bench in WPA 6923 of 2023, refusing to grant any interim order while entertaining the writ petition challenging an order passed by the appellate authority rejecting the appeal filed by the assessee as against the demand of tax on the ground of limitation.

In the present case, a show cause notice was issued to the assessee, regarding the short payment of tax and requesting the production of certain documents as evidence. The assessee did not respond to the notice or provide any documents. As a result, an order was passed on 26.11.2021 determining the tax liability under both the Central and State Acts. The assessee's bank account was attached, and thereafter an appeal was filed by the assessee with the Senior Joint Commissioner of Revenue, Commercial Taxes, Siliguri Circle, but there was a delay of 297 days in filing the appeal. Despite extending the benefit of an order passed by the Supreme Court, there was still a delay of 114 days. The appellate authority, following the statutory provisions of section 107(1) of the GST Act, 2017, dismissed the appeal as it was beyond the permissible period of three months for condonation of delay.

The bench of Acting Chief Justice S. Sivagnanam and Justice Hiranmay Bhattacharyya observed that in this situation, it had to be seen as to what remedy the assessee would be entitled to. They noted that the assessee had already paid tax at a rate of 12% on the basis of being a government contractor. However, the demand for tax was raised at a rate of 18% due to the assessee's failure to provide any documents to establish their status as a registered government contractor before the assessing officer.

“The assessee having paid tax at the rate of 12% at the time of filing returns and also paid the 10% of the disputed tax as pre-deposit at the time of filing the appeal, we are of the view that one more opportunity can be granted to the assessee to produce proof to show that he is a registered government contractor,” observed the bench.