Sk Ayet Ali vs. Union Of INDIA And Anr

Facts

The petitioner, Sk. Ayet Ali, filed a writ petition challenging an ex parte order in original dated October 12, 2022, passed by the Central Excise Authority. The petitioner contended that the order was passed without serving a proper show-cause notice and without affording an opportunity of hearing. The respondent CGST Authority stated that a show-cause notice was issued on April 20, 2021, and allegedly received by one Sankar Pada Sinha, claiming to be the petitioner's accountant, on April 22, 2021. The petitioner denied knowing this individual and disputed the service of the notice, asserting he had no such accountant.

Held

The Court held that the impugned order dated October 12, 2022, was passed ex parte without affording the petitioner an adequate opportunity of hearing and to reply to the show-cause notice. The Court found merit in the petitioner's contention that the service of the show-cause notice was disputed and that the identity of the recipient was not conclusively established as the petitioner's authorized representative. Therefore, in the interest of justice, the Court set aside the impugned order. The matter was remanded back to the respondent Authority to pass a fresh speaking order. The Court directed that no fresh show-cause notice was required, but a copy of the notice dated April 20, 2021, would be served in court upon the petitioner's advocate, which would be treated as service. The petitioner was also directed to provide his present address for correspondence. The respondent Authority was to proceed to pass a fresh order after giving the petitioner an opportunity of hearing, provided the petitioner filed a reply within two weeks. If the petitioner failed to file a reply or attend the hearing, the Authority was free to pass an ex parte order.

Key Issues

1. Whether the impugned order dated October 12, 2022, passed by the Central Excise Authority is liable to be set aside on the ground of being passed ex parte without proper service of show-cause notice and opportunity of hearing to the petitioner? (Question of law and fact, turning on principles of natural justice and procedural fairness under GST law). Petitioner's Contention: The petitioner argued that the order was passed ex parte because no valid show-cause notice was served, and he was denied an opportunity to be heard. He disputed the identity of the person who allegedly received the notice and stated he did not have an accountant by that name. Revenue's Contention: The CGST Authority contended that a show-cause notice was issued on April 20, 2021, and served on April 22, 2021, to an individual identified as the petitioner's accountant, Sankar Pada Sinha. They relied on the record produced pursuant to an earlier court order.