Evergreen Recyclekaro (INDIA) Limited vs. Principal Commissioner Of State Tax

Held

The Court held that the writ petition was maintainable, exercising its jurisdiction under Article 226 of the Constitution, as there were "brazen violations of the principles of natural justice." The Court found that it was an admitted fact that the Show Cause Notice was not uploaded in the "View Notices and Orders" window as required, and that the Petitioner was not served with a copy of the Show Cause Notice. This deprived the Petitioner of a reasonable opportunity to respond, vitiating the consequential Order. The Court also noted that the Respondents, through their counsel, clarified that no personal hearing was granted before passing the Order, which violated the principle of audi alteram partem. Citing a coordinate bench decision in T.S. Lines India Pvt. Ltd. Vs. The State of Maharashtra and Ors, the Court quashed and set aside the Show Cause Notice and the consequential Order. The proceedings were remanded to the Competent Authority to issue a fresh order after providing the Petitioner an opportunity to file its reply to the Show Cause Notice and to afford it an opportunity of being heard. The Court expressly left the merits of the matter undecided.

Facts

The Petitioner, Evergreen Recyclekaro (India) Limited, a company engaged in manufacturing chemical solutions, challenged a Show Cause Notice dated October 18, 2024, and a consequential Order dated December 20, 2024, issued by the Respondent No. 2. These actions pertained to alleged violations under the CGST and MGST Act, 2017, for the financial year 2020-2021. The Petitioner attempted to file a statutory appeal under Section 107 of the CGST/MGST Act in July 2025, but it was rejected due to the expiry of the time limit. The Petitioner then filed a writ petition before the High Court, arguing that the Show Cause Notice and Order were issued in violation of the principles of natural justice.

Key Issues

1. Whether the writ petition is maintainable before this Court, given the availability of a statutory appeal under Section 107 of the CGST/MGST Act, 2017? (Question of law) 2. Whether the Show Cause Notice and the consequential Order were issued in violation of the principles of natural justice, specifically concerning the proper service of the Show Cause Notice and the opportunity of being heard? (Question of mixed law and fact) Petitioner's arguments: The Petitioner contended that the writ petition was maintainable because the Show Cause Notice and Order were in "brazen violation of the principles of natural justice." They argued that the Respondents failed to upload the notices and orders in the designated "View Notices and Orders" window on the portal, instead placing them in the "Additional Notices and Order" section. Furthermore, the Petitioner claimed they were never served with the Show Cause Notice, causing "grave and irreparable prejudice." The Petitioner also argued that the Order was passed without a hearing, violating the principle of audi alteram partem. Respondents' arguments: The Respondents raised a preliminary objection to the maintainability of the writ petition, asserting that a statutory appeal under Section 107 of the CGST/MGST Act was available. They argued that an Intimation dated March 6, 2024, was served prior to the Show Cause Notice, and that the uploading of the Show Cause Notice on the portal constituted due notice to the Petitioner. They supported the impugned actions of the Respondents.