Sri Swapan Santra, Proprietor Of Ma Tara Printers vs. The Commissioner Of The CGST And Cx, Howrah Commissionerate And Ors.

Facts

The petitioner, Sri Swapan Santra, Proprietor of Ma Tara Printers, challenged an adjudication order dated January 31, 2024, issued under the Finance Act, 1994. The petitioner contended that the order was passed in violation of the principles of natural justice as no show-cause notice was served upon him prior to its issuance. The respondent CGST authority, represented by Mr. Banerjee, was directed by the Court to produce records to establish service of the show-cause notice. However, Mr. Banerjee failed to produce any specific document confirming the service of the show-cause notice, admitting that the record did not contain such evidence.

Held

The Court held that the impugned adjudication order dated January 31, 2024, was passed in violation of the principles of natural justice due to the admitted failure of the respondent authority to demonstrate the service of a show-cause notice upon the petitioner. The Court reasoned that since the department could not prove service of the show-cause notice, no purpose would be served by keeping the writ petition pending, as the department could not improve its case. Consequently, the Court set aside the impugned adjudication order. The Court directed the respondent No. 2 to serve a fresh copy of the show-cause notice dated November 7, 2019, and its corrigendum dated January 13, 2023, upon the petitioner within ten working days. The petitioner was granted two weeks from the receipt of these documents to file a reply. The respondent authority was directed to pass a fresh adjudication order after considering the petitioner's reply and affording an opportunity of personal hearing within four weeks of receiving the reply. The Court also stipulated that if the petitioner failed to file a reply within the stipulated time, the impugned adjudication order would stand revived.

Key Issues

1. Whether the impugned adjudication order dated January 31, 2024, passed by the respondent authority, is liable to be set aside on the ground of violation of the principles of natural justice, specifically for non-service of a show-cause notice upon the petitioner, as per the relevant provisions of the Finance Act, 1994? Petitioner's Contention: The petitioner argued that the adjudication order was passed in violation of natural justice because no show-cause notice was served on him before its issuance. The petitioner relied on the principle that a party must be given an opportunity to be heard before an adverse order is passed against them. Respondent's Contention: The respondent CGST authority, represented by Mr. Banerjee, failed to produce any record or document to establish that a show-cause notice was indeed served on the petitioner prior to the passing of the impugned adjudication order. Mr. Banerjee conceded that the departmental records did not contain any specific document evidencing such service.