Order for Detention of Goods Passed on Same Date of Notice Without Hearing to be Set Aside: HC

Case Details: Shido Pharma v. Assistant Commissioner (ST) - [2023] 151 taxmann.com 141 (Madras)

Judiciary and Counsel Details

• • Dr Anita Sumanth, J.
  • R.L. Ramani & B. Raveendran for the Petitioner.
  • E. Ranganayaki for the Respondent.

Facts of the Case

A conveyance was intercepted and notice was issued by the department proposing addition of tax under the IGST Act. The petitioner filed a detailed reply stating that the provisions of the IGST Act were inapplicable to the transaction. However, on the same date, the department issued a revised notice applying the provisions of the CGST Act and SGST Act without granting an opportunity to the assessee to respond.

As a result, an order for detention of goods was passed by the department under section 129(3) of the CGST Act. The assessee filed a writ petition challenging the detention order on the grounds of a violation of the principles of natural justice.

High Court Held

The court held that there was merit in the allegation that the proceedings were concluded contrary to the principles of natural justice. Therefore, the impugned order of detention was set aside. The court directed the assessee to appear before the department without any further notice, and the department was instructed to pass orders de novo after hearing the assessee.