M/S Inframe Technology vs. Assistant Commissioner Shyambazar Division And Others

Held

The Court quashed the impugned notice dated November 12, 2020, and the subsequent notice dated December 18, 2020. The Court found the issuance of the notice to be improper, especially given the admitted position that the assessment for the financial year 2014-15 had already been finalized and an appeal was pending. The Court also expressed dissatisfaction with the department's explanation regarding the misplaced representation. The reasoning was based on the procedural impropriety of issuing a fresh notice when the assessment was concluded and an appeal was underway. The ratio decidendi is that a tax authority cannot issue a show-cause notice for a period where assessment has already been completed and is under appeal, absent specific statutory provisions allowing for such action. The operative direction was to quash the notices.

Facts

The petitioner, M/s. Inframe Technology Pvt. Ltd., challenged a notice dated November 12, 2020, issued by the Superintendent, Range-IV, CGST and Central Excise Shyamnagar Division. This notice pertained to the financial year 2014-15. The petitioner argued that the notice was illegal as assessment for that financial year had already been finalized and an appeal against the assessment order was pending before the appellate authority. The petitioner had also made a representation dated November 30, 2020, against the show-cause notice, which they contended was not considered. The respondents admitted a mistake in issuing the notice and claimed the representation was misplaced.

Key Issues

1. Whether the impugned notice dated November 12, 2020, issued by the Superintendent, CGST and Central Excise, is legally sustainable when the assessment for the financial year 2014-15 has already been finalized and an appeal against the assessment order is pending before the appellate authority? Petitioner's contention: The petitioner argued that the notice was illegal and bad in law because the assessment for the financial year 2014-15 was already completed. They relied on the principle that once an assessment is finalized, a subsequent notice for the same period, especially when an appeal is pending, is not permissible. They also highlighted the non-consideration of their representation dated November 30, 2020. Revenue's contention: The respondent authorities submitted that the impugned notice was issued due to a mistake on the part of the Assessing Officer. They also claimed that the petitioner's representation dated November 30, 2020, was misplaced and not available in their records.