Smt. Priti Gupta vs. The Commissioner Of CGST And Ex, Howrah And Anr.

Held

The Court held that a prima facie case was made out by the petitioner warranting interference. It was admitted that the petitioner filed a detailed representation on August 5, 2024, to the show cause cum demand notice. However, the adjudicating authority proceeded to pass the impugned ex parte order on January 14, 2025, without considering this reply. The Court found such action to be contrary to the basic tenets of the principles of natural justice, rendering the impugned order infirm and vitiated by perversity. Consequently, the order was liable to be set aside. The Court quashed and set aside the order of adjudication dated January 14, 2025. It directed the respondent to consider the petitioner's reply dated August 5, 2024, within three weeks, pass a reasoned and speaking order after granting an effective opportunity of hearing, and communicate the decision within a week thereafter. The petitioner was cautioned against seeking unnecessary adjournments, and the respondent was directed to take an independent decision on merit without being influenced by the observations in the order.

Facts

The petitioner, Smt. Priti Gupta, filed a writ petition challenging an Order of Adjudication dated January 14, 2025, passed by the adjudicating authority under the CGST Act, 2017 and WBGST Act, 2017. A show cause cum demand notice dated April 3, 2024, was issued for the period July 1, 2017, to November 2020, proposing a tax assessment of Rs. 1,12,66,764/-. The petitioner filed a reply on August 5, 2024. Despite this, the adjudicating authority issued three notices for personal hearing, which the petitioner sought adjournments for due to the unavailability of their authorized representative. After granting three adjournments, the authority passed an ex parte order confirming a demand of Rs. 13,13,282/- CGST and Rs. 13,13,282/- SGST, totaling Rs. 26,26,564/-, along with interest, and directed recovery under Section 74(9).

Key Issues

1. Whether the adjudicating authority acted arbitrarily, in excess of jurisdiction, and with gross irregularity and perversity by passing an ex parte order without considering the petitioner's detailed reply dated August 5, 2024, thereby violating the principles of natural justice, as contended by the petitioner under Section 74(5) of the CGST Act, 2017? The petitioner argued that the adjudicating authority passed the order ex parte without considering their detailed reply dated August 5, 2024, making the action arbitrary, in excess of jurisdiction, and suffering from gross irregularity and perversity, thus violating principles of natural justice. The respondents contended that three opportunities for personal hearing were provided as per law, and the allegation of violation of natural justice was incorrect. They argued that the order was passed in accordance with law and did not require interference.