Ushika Overseas PVT LTD And Anr vs. Suptd. Of Central Tax,Burrabazar Div And Ors
Original PDF →Facts
The petitioners, Ushika Overseas Private Limited & Anr., challenged an order dated 18th November, 2020, passed by the Superintendent of Central Tax, cancelling their Goods and Services Tax Registration. This order followed a show cause notice dated 12th November, 2020, and the petitioners' reply dated 17th November, 2020. The petitioners contended that the cancellation order was based on grounds not mentioned in the show cause notice, rendering it arbitrary and without jurisdiction. The show cause notice alleged that the registration was obtained by misrepresentation and fraud, while the cancellation order cited an investigation revealing the non-existence of the principal place of business.
Held
The Court held that it would not entertain the writ petition because an alternative remedy of appeal under Section 107 of the CGST Act is available to the petitioners. The Court noted that the writ court cannot delve into the correctness of fact-finding exercises undertaken by the Proper Officer, and the appellate authority is better equipped to handle such issues. The Court permitted the petitioners to approach the Appellate Authority under Section 107 of the CGST Act by 2nd March, 2021. The Appellate Authority was directed to entertain the appeal without considering the point of limitation, given the timeline of the writ petition filing. The Appellate Authority was also instructed to dispose of the appeal within two months of its filing, without being influenced by any observations made in the present judgment. The Court explicitly stated that it had not gone into the merits of the matter.
Key Issues
1. Whether the cancellation of GST registration, based on grounds not specified in the show cause notice, is arbitrary and without jurisdiction, thereby violating principles of natural justice, as argued by the petitioners. 2. Whether the writ court should entertain a challenge to the cancellation of GST registration when an alternative remedy of appeal under Section 107 of the CGST Act is available, particularly concerning factual findings. Petitioner's Contention: The petitioners argued that the cancellation order was illegal and arbitrary because it relied on grounds (non-existence of principal place of business) that were not part of the show cause notice. They asserted that the Proper Officer should have confined the decision to the charges framed in the show cause notice. Revenue/State's Contention: The respondents, represented by the Superintendent of Central Tax and the State, did not explicitly record arguments in the judgment. However, the Court's inclination to direct the petitioners to the appellate authority suggests an implicit reliance on the availability of an alternative statutory remedy for addressing factual disputes.
Sections Cited
Section 107, CGST Act, 2017
AI-generated summary — verify with the full judgment below
2021 IN THE HIGH COURT AT CALCUTTA Sl. No.56 CONSTITUTIONAL WRIT JURI ICTION (PP) APPELLATE SIDE WPA 9882 of 2020
Ushika Overseas Private Limited & Anr. Vs. Superintendent of Central Tax, Range-IV, Burrabazar, Division, CGST & CX, Kolkata North, Commissionerate & ors. Mr. Vinay Shraff, Mr. Himangshu Kr. Ray ….for the petitioners. Mr. Amitabrata Ray ….for the respondent no.
Mr. Abhratosh Majumdar, Ld. AAG, Mr. Soumitra Mukherjee, Mr. Avra Mazumder ….for the State. The petitioners have challenged the order for cancellation of the petitioners’ Goods and Services Tax Registration dated 18th November, 2020 passed by the Proper Officer, being the Superintendent, Alipore, CGST under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act). This order dated 18th November, 2020 was passed after issuance of a show cause notice for cancellation of registration dated 12th November, 2020 and considering the petitioners’ reply thereto dated 17th November, 2020. The petitioners say that the cancellation order has been made on grounds which did not find place in the show cause notice. The order of cancellation dated 18th November, 2020, according to the petitioners, is, therefor, arbitrary and without juri iction in view of the fact that the proper officer should have considered the petitioners’ case strictly in accordance with the charges made out in the show cause notice.
2 It appears from the charges made out in the show cause notice, that the petitioners have obtained registration certificate by misrepresentation and fraud. The order of cancellation has been made on the basis that on investigation conducted by the HQ (A/E) against the petitioners, it has revealed that there is no existence of the principal place of business of the assessee. Considering the charges made in the show cause notice and those in the order of cancellation, it appears that certain fact finding acts have been undertaken by the Proper Officer. The writ Court cannot go into the correctness of fact finding exercise said to have been undertaken by the Proper Officer. Since an alternative remedy in form of appeal under Section 107 of the CGST Act is available to the petitioners, which is more competent to deal with the fact finding issues, I am not inclined to entertain the instant writ petition. The petitioners are permitted to approach the Appellate Authority under Section 107 of the CGST Act within 2nd March, 2021. In the event the petitioners approach the appropriate Appellate Authority within the time frame, the said authority shall entertain the petitioners’ appeal without going into the point of limitation inasmuch as the order of cancellation is dated 18th November, 2020 and the writ petition was filed on 9th December, 2020 before expiry of the three months period available for preferring an appeal and that a further 30 days extension can be granted on sufficient cause being shown. The petitioners shall also be entitled to take all points available to the petitioners including those taken in the writ petition. The Appellate Authority on being approached in time shall dispose of the petitioners’ appeal within a 3 period of two months from the date of the petitioners preferring the appeal. I have not gone into the merits of the matter and the observations made hereinabove are only for the purpose of adjudicating the instant writ petition. The Appellate Authority should not be influenced by any observations made hereinabove. Nothing further remains to be adjudicated in this writ petition. The same is disposed of accordingly without any order as to costs. Since I have not called for any affidavits, allegations made in the writ petition are deemed to have not been admitted. Urgent photostat certified copy of this order, if applied for, be given to the parties upon compliance with the necessary formalities. (Arindam Mukherjee, J.)
Reproduced from the public record of the Calcutta High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.