M/S R S Cooling Appliances vs. The Union Of INDIA And 3 Ors.
Original PDF →Facts
The petitioner, M/S R S Cooling Appliances, a partnership firm, filed a writ petition challenging a recovery notice dated 03.01.2026 (signed on 03.02.2026) issued by Respondent No. 4, the Superintendent, Central Goods and Service Tax. The petitioner contended that they were unaware of any prior proceedings or show cause notice before receiving the recovery notice. The respondents, represented by the Principal Commissioner and Assistant Commissioner of CGST, stated that the final order was issued by registered post, but could not confirm actual service. The dispute involves the validity of the recovery proceedings and an Order-in-Original dated 05.04.2022, referenced in the recovery notice.
Held
The Court held that the interest of justice would be served by directing the proceedings to be done afresh, allowing the petitioner an opportunity to submit their show cause reply. The Court interfered with the Recovery Notice dated 03.01.2026 (signed on 03.02.2026) and directed that the proceedings be initiated afresh by issuing a copy of the original show cause notice. The petitioner, through their counsel, undertook to collect the show cause notice from the office of Respondent No. 3 within one week and file a reply within the time prescribed in the notice. The Court clarified that this interference was solely on the aspect of not granting an opportunity to be heard and would not influence the adjudication of the dispute. Consequently, the original order dated 05.04.2022 was also interfered with. The writ petition was disposed of on these directions.
Key Issues
1. Whether the recovery proceedings initiated vide Notice C.No.IV(16)188/Misc/SCN-RSCA /Ghy-I/Tech-II/19-20/1375 dated 03.01.2026 (signed on 03.02.2026) by Respondent No.4 are valid, considering the petitioner's claim of not receiving any prior intimation or show cause notice? 2. Whether the Order-in-Original No. 133/DC/Audit/CGST/2021-22 dated 05.04.2022, as stated in the recovery notice, should be set aside due to procedural irregularities? Petitioner's Arguments: The petitioner argued that they first became aware of any proceedings upon receiving the recovery notice and that no show cause notice was ever served upon them. They sought to have the recovery proceedings and the referenced Order-in-Original set aside, and to be granted an opportunity to submit a reply to a show cause notice and have the matter adjudicated afresh. Revenue's Arguments: The revenue submitted that the final order was issued to the petitioner by registered post, but conceded they lacked further instructions regarding the actual service of the notice.
Sections Cited
Section 73 (implied by show cause notice and adjudication), Section 129 (implied by recovery proceedings)
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Cause title — parties, addresses and appearances
ORDER 06.03.2026
Heard Shri R. S. Mishra, learned counsel for the petitioner. Also heard Shri S. C. Keyal, learned Senior Standing Counsel, CGST and Ms. M. Barman, learned counsel appearing on instructions of Ms. A. Gayan, learned CGC.
Considering the subject matter involved and as agreed to by the learned counsel for the parties, this writ petition is taken up for disposal at the motion stage. Suffice it to mention that on the previous occasion i.e. on 27.02.2026 when the matter had come up for consideration, time was granted to Shri Keyal, learned Senior Standing Counsel to obtain the instructions which he has done.
The grievance of the petitioner pertains to a recovery notice dated 03.01.2026 which has been signed on 03.02.2026 with the contention that prior to such notice, no intimation of any nature was served upon him. For ready reference, the relief prayed for is extracted herein below: “ In the premises aforesaid, it is therefore prayed that Your Lordships may be pleased to consider the above, call for the records, issue a rule calling upon the respondents to show cause as to why; (I) The recovery proceeding initiated vide Notice issued under C.
Page No.# 3/4 No.IV(16)188/Misc/SCN-RSCA /Ghy-I/Tech-II/19-20/1375 dated 03.01.2026 (signed on 03.02.2026) by Respondent No.4 (ANNEXURE-A); (II) The Order adjudication passed if any against the Petitioner including the Order-in- Original No. 133/DC/Audit/CGST/2021-22 dated 05.04.2022 as stated in the said notice dated 03.02.2026 shall not be set aside and further as to why (III) The respondent authorities shall not be directed to furnish the copy of the show cause notice to the Petitioner and adjudicate the show cause notice after granting an opportunity of submitting reply to the said show cause notice and also upon hearing the matter adjudicate the matter afresh and upon such cause or causes that may be shown hearing the parties perusing the records further be pleased to make the rule absolute and/or pass any other order or orders as Your Lordship deem fit and proper. --AND- It is further prayed that pending disposal of this rule, the Recovery Notice issued under C.No.IV(16) 188/Misc/SCN-RSCA /Ghy-I/Tech-II/19-20/1375 dated 03.01.2026 (signed on 03.02.2026) issued by Respondent No.4 (ANNEXURE-A) as well as Order- in-Original bearing No.133 /DC/Audit /CGST/2021-22 dated 05.04.2022 may be stayed and/or the respondent authorities may be directed not to take any steps for recovery of impugned demand. And for this act of grace, the Petitioner as in duty bound shall ever pray.”
Shri Mishra, the learned counsel by drawing the attention of this Court to the averments made in the petition has submitted that for the first time, the petitioner was aware of a proceeding on receipt of the recovery notice.
On the other hand, Shri Keyal, the learned Standing Counsel has submitted that as per instructions received, the final order was indeed issued to the petitioner by registered post. However, he is not equipped with further instructions with regard to the aspect of actual service of notice.
Considering the aforesaid factual position, this Court is of the opinion that Page No.# 4/4 instead of keeping this writ petition pending, interest of justice would be served if the proceeding is directed to be done afresh whereby the petitioner would get an opportunity to submit his show cause reply.
Accordingly, the Recovery Notice dated 03.01.2026 (signed on 03.02.2026) is interfered with and the proceeding is directed to be initiated afresh by issuance of a copy of the original show cause notice. Since the petitioner is already represented and as undertaken by Shri Mishra, the learned counsel the show cause notice would be collected by the petitioner from the office of the respondent no. 3 within a period of 1 week from today, whereafter he will file reply within the time prescribed in the said notice. It is made clear that the present interference is only on the aspect of not granting any opportunity and will not influence either of the parties in the adjudication of the dispute.
It is needless to state that the original order dated 05.04.2022 is also interfered with.
Writ petition accordingly stands disposed of.
JUDGE Comparing Assistant
Reproduced from the public record of the Gauhati High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.