In a recent landmark judgment dated December 18, 2023, the Hon’ble Madras High Court addressed the predicament faced by M/s. Samadhu Medicals in the case against the Deputy Tax Officer [Writ Petition NO. 35228 OF 2023]. The focal point of the case was the dispute arising from GSTR-3B and GSTR-2A mismatch, exacerbated by the demise of key personnel responsible for compliance. The court’s ruling sheds light on the avenues available to aggrieved parties in such scenarios.
Facts:
M/s. Samadhu Medicals found themselves entangled in a web of complications when discrepancies surfaced in the FORM GSTR-3B and FORM GSTR-2A statements during the Assessment Year 2019-20. Notifications regarding these disparities were primarily communicated to the mobile number of Mr. Paneerselvam, an employee of the petitioner who passed away on April 30, 2019. Subsequent notifications were sent to the email ID of Mr. Sivakumar, a consultant for the petitioner, who also met his demise on February 5, 2022. Unaware of the initiation of proceedings (“Impugned Proceedings”), the petitioner only became aware when the Order (“Impugned Order”) was issued, attaching their bank account.
The Deputy Tax Officer (“the Respondent”) argued that the petitioner, despite the deaths of the individuals responsible for filing returns, should have taken corrective measures, such as engaging another accountant. The Respondent contended that the petitioner cannot claim ignorance of the Impugned Orders.
Aggrieved by the Impugned Order, the petitioner sought redress through the filing of the present writ petition.
Issue:
The primary issue at hand was whether an appeal could be filed before the Appellate Authority if the aggrieved party had not followed prior proceedings due to the demise of key personnel responsible for compliance.
Court’s Decision:
The Madras High Court, in its judgment on December 18, 2023, made the following key determinations:
- Right to Appeal: The court directed the petitioner to present their case before the Appellate Authority by filing an appeal within thirty days from the date of receipt of the order.
- Limitation Aspect: The court ruled that the Appellate Authority should entertain the appeal without insisting upon the limitation aspect. In other words, the time lapse since the initiation of proceedings should not be a hindrance, especially considering the unique circumstances involving the demise of key personnel.
- Opportunity for the Petitioner: The court emphasized that the Authorities concerned should dispose of the appeal in accordance with the law, affording the petitioner a fair opportunity to present their case.
As a result of these findings, the writ petition was disposed of, providing a clear path for the petitioner to seek relief through the appellate process.
Conclusion:
The Madras High Court’s ruling in the Samadhu Medicals case sets a precedent for cases where the demise of key personnel complicates compliance matters. It underscores the importance of allowing aggrieved parties a fair opportunity to appeal, even in situations where procedural lapses occurred due to unavoidable circumstances. This judgment reinforces the principle of equity in the face of unforeseen challenges in the realm of tax compliance.
