Bhumana Ramachandra Reddy vs. Union Of INDIA

Held

The Court held that the impugned order dated 24.11.2022, passed by the 4th respondent (Deputy/Assistant Commissioner), was in clear violation of the Court's previous order dated 29.06.2022 in W.P.No.27336 of 2022. The earlier order had specifically directed the 3rd respondent (Commissioner of Central Tax and Customs) to consider the petitioner's representations after affording an opportunity of hearing. The Court found that the 4th respondent, being an Assistant Commissioner and not a Commissioner as defined under Section 2(16) of the CGST Act, 2017, ought not to have entertained the representations and passed the order, especially when the petitioner had raised a specific objection regarding the 4th respondent's locus standi. The Court rejected the respondents' contention that the Assistant Commissioner was the proper officer, emphasizing that the prior direction was specifically to the Commissioner. Consequently, the impugned order was set aside/quashed. The 3rd respondent was directed to consider the petitioner's representations dated 18.04.2022 and 28.04.2022, afford an opportunity of hearing, and pass appropriate orders within 30 days.

Facts

The petitioner, Bhumana Ramachandra Reddy, a proprietor of an IAS coaching center, was registered under the previous Service Tax regime. Upon migration to GST, the respondent authorities allegedly effected a suo motu migration using an incorrect mobile number and email address belonging to an officer. This prevented the petitioner from receiving OTPs and filing his GST returns electronically. Despite repeated representations and visits to the respondent office, the issue persisted until February 2019. Subsequently, the petitioner received demands for interest on delayed returns, and a garnishee order was issued to his bank for Rs. 30,07,927. A previous writ petition (W.P.No.27336 of 2022) directed the Commissioner (3rd respondent) to consider the petitioner's representations within 30 days, with a stay on the garnishee order. However, the impugned speaking order demanding interest was issued by the Deputy/Assistant Commissioner (4th respondent).

Key Issues

1. Whether the impugned Speaking Order No.O1/2022-23 GST dated 24.11.2022, issued by the Deputy/Assistant Commissioner (4th respondent), is illegal and arbitrary, violating Article 14, 19(1)(g), and 21 of the Constitution of India, given the specific directions in W.P.No.27336 of 2022 to the Commissioner (3rd respondent) to consider the representations. Petitioner's arguments: The petitioner argued that the 4th respondent lacked the legal standing to issue the impugned order, as this Court had specifically directed the 3rd respondent (Commissioner) to consider the representations. The issuance of the order by the 4th respondent, despite this specific direction and the petitioner's written objections, renders it illegal and arbitrary. The petitioner also contended that the suo motu migration by the authorities, which caused the delay in filing returns, was done without his knowledge or permission, and that he had made online payments for his tax liability. Revenue's arguments: The learned counsel for the respondents attempted to defend the order by referring to Circular No.313/2017-GST, which designates the Assistant Commissioner as a proper officer under the CGST Act, 2017, thus asserting the validity of the order passed by the 4th respondent.