M/S. Avinash Transport And Ors. vs. The Supdt. Group2, CGST And Central Excise, Circle 1, Asasnsol, Dugapur Audit Commisi. And Ors.

Facts

The petitioners, M/s. Avinash Transport & Ors., challenged a notice for recovery of demand dated April 24, 2019, and a subsequent notice dated May 11, 2023, issued by the Superintendent, Group –2, CGST & Central Excise, Asansol. These notices pertained to a demand arising from an alleged draft audit report. The petitioners had not responded to or challenged the initial demand notice dated April 24, 2019, for over four years. They later made representations on October 12, 2022, and April 10, 2023, which were more than three years after the initial demand. The writ petition was filed on July 14, 2023, seeking to challenge the demand.

Held

The Court held that the writ petition was not maintainable due to the inordinate delay and laches. The primary issue was the petitioners' failure to challenge the initial demand notice dated April 24, 2019, for over four years. The Court found no proper or cogent explanation for this delay. The subsequent representations made by the petitioners after more than three years were considered insufficient to revive a stale cause of action, as per well-settled principles of law. The Court noted that the petitioners were not lay persons or individuals lacking the means to approach the court within a reasonable time. Consequently, the Court was not inclined to entertain the writ petition.

Key Issues

1. Whether the writ petition is maintainable given the inordinate delay and laches in challenging the demand notice dated April 24, 2019? (Question of law). Petitioners' arguments: The petitioners contended that they had made representations against the initial recovery notice, implying a continuous cause of action or a basis for their subsequent challenge. They sought to revive a stale cause of action through these representations. Revenue/State's arguments: The revenue authorities argued that the petitioners failed to respond to or challenge the initial demand notice for over four years. They asserted that the representations made after such a significant delay did not revive a stale cause of action and that the petitioners, being organized entities, had no proper explanation for the delay in approaching the court.