Brij Mohan Bagri vs. The State Of West Bengal And Ors.
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The petitioner, Brij Mohan Bagri, filed a writ petition challenging an order dated December 11, 2023, passed under Section 73 of the WBGST/CGST Act, 2017, for the tax period April 2018 to March 2019. The petitioner received a notice in Form GST DRC-01A on February 28, 2023, and sought an adjournment. Subsequently, a show cause notice was issued on March 13, 2023. The petitioner again applied for an adjournment on April 13, 2023, but the proper officer proceeded to pass an order in Form DRC-07 on December 11, 2023, determining the petitioner's liability at Rs. 10,59,190/-. The writ petition was filed on May 9, 2024.
Held
The Court held that the petitioner's contention of violation of natural justice was not substantiated. The proper officer had issued a show cause notice on March 13, 2023, offering an opportunity to file a response by April 13, 2023, and also a personal hearing on that date. The petitioner, however, waited until the last date to seek an adjournment. The Court found that the petitioner had been afforded repeated opportunities and chose not to present himself. The judgments relied upon by the petitioner were distinguished: Mahaveer Trading Company involved a taxpayer who appeared on multiple dates and filed replies, unlike the present case, and Goutam Bhowmick concerned a situation where no date for personal hearing was intimated. The Court also noted the significant delay in filing the writ petition. However, the Court did not prevent the petitioner from enforcing statutory rights, allowing them to approach the Appellate Authority within three weeks, with the Appellate Authority to hear the appeal on merit, considering the absence of the Appellate Tribunal. The order under Section 73(9) was not set aside but the petitioner was given an avenue to pursue statutory remedies.
Key Issues
1. Whether the order passed by the proper officer under Section 73(9) of the said Act is liable to be set aside for violation of the principles of natural justice, specifically for not granting an adequate opportunity of hearing, as contended by the petitioner under Section 75(4) and 75(5) of the said Act. The petitioner argued that an adverse order cannot be sustained without a proper hearing and relied on judgments from the Allahabad High Court in Mahaveer Trading Company v. Deputy Commissioner State Tax & Anr. and this High Court in Goutam Bhowmick v. State of West Bengal. 2. Whether the writ petition is maintainable given the delay in filing and the availability of statutory appeal remedies, as argued by the State. The State contended that the ordinary period for appeal under Section 107 had expired and the writ petition was an attempt to delay execution, arguing that the judgments relied upon by the petitioner were distinguishable on facts.
Sections Cited
Section 73, Section 73(9), Section 75(4), Section 75(5), Section 107, Section 14, Section 112
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Cause title — parties, addresses and appearances
judgment delivered by Division Bench of Allahabad High Court in the case of Mahaveer Trading Company v. Deputy Commissioner State Tax & Anr., having neutral citation no. 2024:AHC:38829-DB. He has also placed reliance on the judgement delivered by the Division Bench of this High Court in the case of Goutam Bhowmick v. State of West Bengal, reported in [2024] 158 taxmann.com 399 (Calcutta). Having regard to the aforesaid, it is submitted that this Hon’ble Court may set aside the said order and sent back the matter to the proper officer for re- adjudication of the same.
Mr. Siddiqui, learned advocate appearing on behalf of the respondents would submit that the petitioner has challenged the order passed by the proper officer on 11th December, 2023 by filing the writ petition on 9th May, 2024. According to him the ordinary period for preferring an appeal before the Appellate Authority under Section 107 of the said Act had long expired. The belated writ petition filed by the petitioner is only intended to delay the execution. It is submitted that although, the petitioner questions violation of principle of natural justice, however, in the instant case, it
4 would appear that the petitioner has not taken any steps for having the issue determined by the proper officer expeditiously. On repeated occasion, adjournment had been sought for. Having regard to the above and by referring to the judgement relied upon by Mr. Choraria, he submits that a judgement is an authority for what it decides and not what can be logically deduced thereof. The judgements relied on by the petitioner do not support his case. In view thereof, the writ petition should be dismissed with costs.
Heard the learned advocates appearing for the respective parties and considered the materials on record. At the first blush, I was prompted to take note of the submission made by Mr. Choraria as regards the violation of the principle of natural justice. However, when I look deep into the matter, it appears that the initial pre-showcause was served on the petitioner on 28th February, 2023 in form GST DRC-01A. The petitioner chose to not to respond to the same, instead the petitioner had applied for an adjournment. Subsequently, however, the notice in form GST DRC-01 had been uploaded on the portal on 13th March, 2023 the time to respond to which was set on 13th April, 2023. It appears that the proper Officer by the
5 aforesaid show cause notice had not only offered opportunity to file response but also afforded a personal hearing to the petitioner. The same would reveal that the petitioner was required to file his response by 13th April, 2023 and personal hearing was also offered on the said date. As such it cannot be said that adequate time to file the response and the opportunity of personal hearing was not offered.
Records would however, reveal that the petitioner had waited for the last date for filling its response i.e. 13th April, 2023 and on that date had sought for an adjournment.
It would appear that on 11th December, 2023 an order under Section 73 of the said Act had been passed thereby determining the liability of the petitioner to the extent of Rs.10,59,190/-. Even after the aforesaid order was passed, the petitioner did not take any steps. There is no explanation forthcoming from the petitioner as to what prevented the petitioner from filing an appeal or from approaching this Court earlier.
Mr. Choraria would however, contend that since there has been statutory violation, the petitioner would not require to prefer an appeal and that the aforesaid order cannot be sustained, and in
6 support thereof had relied on two several judgements. I find that in the case Mahaveer Trading Company (supra), the only issue involved in the said case was non-compliance of provision of Section 75(4) of the said Act. Admittedly, in the said case the registered tax payer therein had appeared before the competent authority on three several dates unlike the present case. On three several dates the registered tax payer had filed its reply. It is on the basis of the replies filed by the registered tax payer that the proper officer had decided the matter without giving an opportunity of hearing to the registered tax payer. The aforesaid judgement, in my view, does not assist the petitioner. The same is distinguishable on facts. The judgement relied on by Mr. Choraria in the case of Goutam Bhowmik (supra), deals with an assessment where neither any date, time or place of any personal hearing was intimated to the registered tax payer and the Assistant Commissioner of State Tax, GST, Jalpaiguri charge, had passed the impugned order under Section 73 of the said Act. It is in those set of facts that the Division Bench of this Hon’ble Court was, inter alia, pleased to entertain the writ
7 petition and set aside the order impugned on the ground of violation of principle of natural justice.
The present case is however, entirely different. The petitioner was afforded with repeated opportunities. The petitioner chose not to present himself. In fact, even after the order under Section 73(9) of the said Act was passed on 11th December, 2023, the petitioner sat tight over the matter and waited and watched the proceeding. It is only on 9th May, 2024 that the present writ petition has been filed. In my view, the petitioner cannot be permitted to invoke the extraordinary writ juri iction of this Hon’ble Court alleging statutory violation and violation of principles of natural justice in the facts of this case.
Having regard to the aforesaid, I am of the view that there is no scope for interference. The aforesaid order shall however, not prevent the petitioner from enforcing its statutory right, if any, if so advised. In such event, the petitioner shall be entitled to the benefit of the provision of Section 14 of the said Act and the Appellate Authority shall hear out and dispose of the appeal on merit, taking note of the fact that at present the Appellate Tribunal under Section 112 of the said Act is yet to be constituted, provided the petitioner
8 approaches the Appellate Authority within a period of three weeks from date. The Appellate Authority shall hear out and dispose of the appeal on merit subject to compliance of other formalities.
The writ petition stands disposed of. Urgent photostat certified copy of this order, if applied for, be supplied to the parties expeditiously after due compliance.
(Raja Basu Chowdhury, J.)
Reproduced from the public record of the Calcutta High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.