I And S Communique PVT. LTD vs. Commissioner Of CGST, Audit-Ii, Delhi & Anr.

Facts

The petitioner, I AND S COMMUNIQUE PVT. LTD, challenged a show cause notice dated April 27, 2021, issued by the Commissioner of CGST, Audit-II, Delhi. The petitioner contended that the show cause notice was issued beyond the period of limitation prescribed under Section 73 of the Finance Act, 1994. The respondents raised a preliminary objection regarding the maintainability of the writ petition, arguing that the petitioner should have raised this plea before the Adjudicating Authority. The respondents also noted that the show cause notice was issued by applying the proviso to Section 73(1), invoking an extended period of limitation. In light of these submissions, the petitioner sought to withdraw the petition while reserving the right to raise all permissible pleas before the Adjudicating Authority.

Held

The Court dismissed the writ petition as withdrawn. The petitioner was granted leave to withdraw the petition, reserving the right to raise all permissible pleas in law before the Adjudicating Authority, including the issue of the invocation of the extended period of limitation. The petitioner was directed to file a reply to the show cause notice within 30 days from the date of the order. The Adjudicating Authority was then empowered to adjudicate the show cause notice, including the question of the extended period of limitation, in accordance with the law, after providing the petitioner with an opportunity for a personal hearing. The Court explicitly clarified that it had neither considered nor commented on the merits or contentions of either party and that all rights and contentions were reserved. It was further clarified that the time spent pursuing the writ petition would not be counted towards the period of limitation prescribed under Section 73(4B)(b) of the Finance Act, 1994.

Key Issues

1. Whether the writ petition is maintainable before this Court, or should the petitioner raise the issue of limitation before the Adjudicating Authority? Petitioner's contention: The petitioner argued that the show cause notice was issued beyond the period of limitation prescribed under Section 73 of the Finance Act, 1994. Respondents' contention: The respondents raised a preliminary objection to the maintainability of the petition, stating that the petitioner should have raised the plea regarding the extended period of limitation, invoked under the proviso to Section 73(1), before the Adjudicating Authority. They argued that this plea could have been raised before the Adjudicating Authority without prejudice.