The Royal Calcutta Golf Club vs. Principal Commissioner Of CGST And Cx Kolkata South CGST And Cx Comm. And Ors

Facts

The appellant, The Royal Calcutta Golf Club, filed a writ petition challenging a show cause notice dated July 16, 2021, issued by the Principal Commissioner of CGST & CX, Kolkata. The show cause notice pertained to an application for refund of duty. The writ petition was admitted, and the department filed an affidavit-in-opposition. However, the learned writ Court dismissed the writ petition by an order dated January 2, 2024, directing the appellant to submit a reply to the show cause notice. The appellant then filed this intra-Court appeal against the dismissal order. The appellant argued that the show cause notice was barred by limitation and that the theory of unjust enrichment was applicable.

Held

The Court held that since the writ petition had been pending since 2021, the department had filed an affidavit-in-opposition, and arguable points were raised by the appellant, the matter should be decided on its merits by the learned writ Court. The Court was convinced to take this stand because the legal issues raised by the appellant were also pending consideration before the learned Single Bench in other writ petitions filed by similarly placed organizations. Therefore, the Court restored the writ petition to the file of the learned Single Bench to be heard and decided along with analogous cases. The appeal and connected application were allowed, and the order passed in the writ petition was set aside. The Court clarified that both the appellant and the respondent department are entitled to canvass all factual and legal issues in the pending writ petition.

Key Issues

1. Whether the learned writ Court erred in dismissing the writ petition and directing the appellant to reply to the show cause notice, instead of deciding the matter on merits, given that the writ petition was admitted and affidavits were filed. Contentions of the Appellant: The appellant contended that the show cause notice was barred by time and that the principle of unjust enrichment was applicable. They argued that the writ petition, having been admitted and pending since 2021 with affidavits filed, should be decided on its merits. Contentions of the Revenue/State: The respondent CGST authority argued that Section 11(B) of the Central Excise Act, 1944, provides the period of limitation for refund claims, and therefore, the show cause notice was correctly issued. They contended that the authority should be permitted to adjudicate the show cause notice. The respondent relied on the decisions in Collector of C.E., Chandigarh vs. Doaba Cooperative Sugar Mills (1988) and Samsera Engineering Ltd. vs. Deputy Commissioner, Large Tax Payer Unit, Bengaluru (2022), and other decisions regarding unjust enrichment.