M/S Singh Traders vs. The State Of Bihar

Held

The Court, taking note of the submissions of both parties and without delving into the merits of the case, set aside the impugned order dated April 29, 2024, passed by Respondent No. 3 for the period 2018-2019. The Court found that the case was identically situated to the judgment delivered in CWJC No. 18648 of 2024, which had set aside similar orders on the ground of violation of the statutory mandate for notice of personal hearing. Consequently, the matter was remitted to Respondent No. 3 with a direction to provide a personal hearing to the petitioner through its authorized representative and thereafter pass fresh orders. The Court also directed the petitioner to appear before the Assessing Officer on June 30, 2025, and the Assessing Officer was to pass orders within three months or within the remaining limitation period, whichever is later. The issue regarding the validity of the notification extending the time limit was not expressly decided.

Facts

M/s Singh Traders, a proprietorship firm, filed a writ petition before the Patna High Court challenging a show cause notice and a subsequent order passed by the Deputy Commissioner of State Tax, Shahabad. The show cause notice, dated December 19, 2023, and the order dated April 29, 2024, pertained to the tax period April 2018 to March 2019. The petitioner sought to quash these notices and orders, primarily arguing that they were time-barred under Section 73 of the BGST/CGST Act, 2017, and that the order was passed without providing sufficient opportunity for a hearing, violating principles of natural justice. The petitioner also challenged a notification extending the time limit under Section 73(2) and (10) of the CGST Act, 2017.

Key Issues

1. Whether the show cause notice and the subsequent demand order for the period April 2018 to March 2019 are time-barred under Section 73 of the BGST/CGST Act, 2017? 2. Whether the demand order dated April 29, 2024, was passed in violation of the principles of natural justice by failing to provide a sufficient opportunity for a personal hearing, as envisaged under Section 75(4) of the GST Act? 3. Whether the notification No. 56/2023 CT dated December 28, 2023, extending the time limit under Section 73(2) and (10) of the CGST Act, 2017, is justified and legally valid? Petitioner's Arguments: The petitioner contended that the show cause notice and the demand order were time-barred. They further argued that the demand order was passed without affording a proper personal hearing, violating principles of natural justice. The petitioner also challenged the validity of the notification extending the time limit, arguing it was not issued under special circumstances and not recommended by the GST Council as required by Section 168A of the Act. The petitioner relied on a previous judgment of the High Court in CWJC No. 18648 of 2024. Revenue's Arguments: The State's counsel conceded that the case appeared to be identically situated to the previously decided case and suggested a similar order could be passed.