M/S. Shree Narayan Studios P. LTD. vs. Ministry Of Finance, Dept. Of Rev.

Facts

The petitioner, M/s. Shree Narayan Studios Private Limited, filed a writ petition challenging an order-in-original dated January 25, 2023, passed by the Joint Commissioner, Kolkata South CGST. The petitioner contended that the order violated the principle of natural justice and demonstrated a non-application of mind. Specifically, the petitioner pointed out that they had filed an objection on January 11, 2021, against a show-cause notice dated December 31, 2020. However, the impugned order incorrectly stated that no objection was filed. The petitioner argued this was contrary to the record and deprived them of having their objections considered.

Held

The Court held that the impugned order-in-original dated January 25, 2023, passed by the Joint Commissioner, Kolkata South CGST, was liable to be set aside. The Court found that the respondent authority's recording that the petitioner had not filed any objection to the show-cause notice was contrary to the record and perverse. This constituted a violation of the principle of natural justice, as the petitioner was deprived of having their objections, raised in their reply dated January 11, 2021, considered and addressed. The Court noted that the revenue's counsel could not defend this factual inaccuracy. Consequently, the Court set aside the impugned order and remanded the matter back to the respondent authority to pass a fresh order in accordance with law, after providing an opportunity of hearing and duly considering the petitioner's objections. The fresh order was to be passed within eight weeks from the date of communication.

Key Issues

1. Whether the impugned order-in-original dated January 25, 2023, passed by the Joint Commissioner, Kolkata South CGST, is liable to be set aside on the ground of violation of the principle of natural justice, specifically by failing to consider the petitioner's objection dated January 11, 2021, against the show-cause notice dated December 31, 2020? Petitioner's Arguments: The petitioner argued that the impugned order violated the principle of natural justice as it erroneously recorded that no objection was filed against the show-cause notice, despite a timely objection being submitted. This failure to consider their objections demonstrated a non-application of mind by the adjudicating authority. Revenue's Arguments: The learned Advocate for the respondents could not justify or defend the impugned order's recording that no reply to the show-cause notice was filed, acknowledging it was contrary to the record.