The Andhra Pradesh High Court held that the assessment orders are deemed to have been withdrawn after the taxpayer subsequently filed the requisite GSTR-3B returns, subject to payment of the additional late fee, if applicable.

The Bench of Justice Ninala Jayasurya and Justice Tuhin Kumar Gedela has declared that the assessment orders passed under Section 62 of the GST Act, shall be deemed to have been withdrawn upon payment of the additional late fee, if the same had not already been paid.

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The petitioner, a partnership firm engaged in the business of supplying services, had been assessed under the GST law for two sets of tax periods.

The first assessment order was dated November 18, 2021, covering the period from March 2021 to September 2021. The second order was dated May 20, 2022, covering October 2021 to March 2022.

According to the High Court, both assessment orders were passed under Section 62 of the GST Act, on the ground that the petitioner had failed to file its returns for the relevant periods.

Following the assessment orders, recovery proceedings were initiated for the assessed tax amounts along with interest and penalty. The petitioner thereafter approached the High Court challenging the assessment orders.

The petitioner argued that a Section 62 assessment is liable to be treated as withdrawn once the taxpayer files the pending returns and pays the tax declared in those returns within the statutory framework.

The petitioner contended that the GST law also permits filing of returns beyond the prescribed period upon payment of the applicable late fee. In the present case, the petitioner had subsequently filed the required GSTR-3B returns along with payment of late fee.

The High Court noted that the issue was already covered by an earlier Division Bench decision of the Andhra Pradesh High Court in Brothers Engineering and Errectors Ltd. v. State of Andhra Pradesh.

In that case, the Court had followed the earlier decision of the Madras High Court in Helmet House v. Deputy State Tax Officer-1, Madurai.

The judicial position emerging from those decisions was that an assessment order passed under Section 62 would have to be treated as withdrawn once the taxpayer files the returns, whether within the prescribed period or beyond that period, provided the applicable late fee is paid.

The Andhra Pradesh High Court found that the same legal principle applied to the present case.

During the hearing, the Government Pleader for Commercial Tax did not dispute the legal position relied upon by the petitioner. However, the Revenue submitted that the petitioner was required to pay the additional late fee as well.

The High Court accordingly took note of the requirement while granting relief to the taxpayer.

The Court further directed that no recovery proceedings shall be initiated or continued for recovery of the taxes and dues raised under those assessment orders.

The Court also ordered that there would be no order as to costs, and closed the pending miscellaneous petitions.

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