In a recent decision by the Madras High Court, a writ petition filed by Tvl. Kajah Enterprises (P) Ltd. was allowed, challenging the rejection of their rectification application by the Assistant Commissioner (Inspection) without any stated reasons. The petitioner had initially filed this application on March 11, 2025, contesting an earlier assessment order from January 6, 2025. However, the application was dismissed on March 28, 2025, without any explanation or a hearing notice.
The central issue in this case was whether the dismissal of a rectification application without providing reasons or a hearing violates statutory and constitutional protections. The court found that the rejection lacked any indication of an apparent error on the record, nor did it provide any justification for the absence of such an error. The court emphasized that when a rectification application is filed by an assessee, and the rectification is sought to be rejected, it is essential that the assessee is notified and given reasons for the rejection.
The court concluded that the rejection order dated March 28, 2025, was contrary to the provisions of Section 161. As a result, the court set aside the order and allowed the writ petition, reinforcing the necessity for transparency and due process in handling rectification applications under the GST framework.
Order Date – 08 May 2025
Parties: Tvl. Kajah Enterprises (P) Ltd. Vs The Assistant Commissioner (Inspection) (ST-IU),
Facts –
- The Petitioner, Tvl. Kajah Enterprises (P) Ltd., filed a rectification application on 11.03.2025 challenging an assessment order dated 06.01.2025. The application was rejected by the officer on 28.03.2025 without providing any reasoning or notice of hearing.
Issue –
- Whether rejection of a rectification application without stating reasons and without hearing violates statutory and constitutional safeguards?
Order –
- The Single judge bench of the high court observed that perusal of the order does not also indicate that there had been no error apparent on the record to reject the rectification. There is also no reasonings as to why there is no error apparent on the face of the record. For this reason, the impugned order dated 28.03.2025 is liable to be set aside.
- If pursuant to a Rectification Application, if a rectification is made and if it adversely affects the assessee, 3rd Proviso contemplates an opportunity of hearing to be given. However, when a Rectification Application is made at the instance of assessee and the rectification is being sought to be rejected without considering the reasons for rectification or by giving reasons as to why such rectification could not be entertained, it is also imperative that the assessee should be put on notice.
- For the aforesaid reasons, the court inclined to hold that the order of rectification passed by the respondent dated 28.03.2025 is contrary to the provisions of Section 161 and in that aspect, the same alone is set aside. The Writ Petition is allowed.
