Rajesh Kumar Jaiswal vs. State Of West Bengal And Ors.

Held

The Court held that the writ petition was not maintainable at the show-cause stage. It found that the petitioner had not raised any jurisdictional issue and that the show-cause notice was detailed and specific, with adjudication yet to take place. The Court emphasized that the scheme of the WBGST/CGST Act, 2017, provides for multiple opportunities for a taxpayer to clarify their position, respond to show-cause notices, and avail personal hearings before an adjudicating authority. Since Section 74 of the Act was invoked, it was deemed appropriate to allow the adjudicating officer to decide the matter. The Court noted that an adjudication order under Section 74 is appealable under Section 107, and further appeals are possible before the appellate tribunal. Therefore, the petitioner was not remediless. The Court directed the proper officer to hear the show-cause notice in accordance with law, allowing the petitioner to file a response within two weeks if not already done. The proper officer was to decide the matter after affording an opportunity of hearing, considering Section 75(4) of the Act, and expected to do so expeditiously within 12 weeks. The petitioner was permitted to raise all points raised in the writ petition before the proper officer, who was to adjudicate upon them.

Facts

The petitioner, Rajesh Kumar Jaiswal, filed a writ petition challenging a show-cause notice in Form DRC-01 dated September 12, 2025, issued under Section 74 of the WBGST/CGST Act, 2017. The notice pertained to the tax period April 2019 to March 2022. The petitioner contended that a pre-show-cause notice in Form DRC-01A was issued on September 23, 2024, alleging dealings with M/s Pradhan Enterprise for the financial year 2021-22, despite the agency's registration being cancelled suo motu on March 30, 2020. Similar allegations were made regarding dealings with other third parties whose registrations were cancelled in 2019. The petitioner claimed to have responded to these allegations, but the authorities proceeded to issue the show-cause notice in violation of settled law. The writ petition was admitted, and parties exchanged affidavits.

Key Issues

1. Whether the show-cause notice issued under Section 74 of the WBGST/CGST Act, 2017, is liable to be quashed on the grounds of violation of settled law, specifically concerning the petitioner's response to prior allegations and dealings with entities whose registrations were cancelled. Petitioner's arguments: The petitioner argued that the show-cause notice was issued in "utter violation of the settled law" and therefore could not be sustained. The petitioner's response to the pre-show-cause notice was allegedly disregarded. Revenue/State's arguments: The State did not explicitly record arguments in the judgment. However, the Court noted that it was not the case of the petitioner that the issues raised could not be decided by the proper officer under Section 74 of the Act. The Court also observed that the scheme of the Act provides multiple opportunities for taxpayers to respond and that the show-cause notice was detailed and not vague.