M/S Shree Jewellers vs. The Union Of INDIA

Held

The Court held that the limitation period for assessment is indeed extended by the periods excluded by the Supreme Court and further by any notified extensions. However, the Court found no reason to interfere with the orders on the ground of limitation alone. Regarding the procedure for scrutiny, the Court clarified that Section 73 is a standalone provision that can be invoked independently when it appears to the Proper Officer that there is tax escapement, erroneous refund, or wrongful claim of input tax credit. It is not mandatory for every Section 73 proceeding to be preceded by a notice in Form GST ASMT-10, as Section 73 itself is a notice. The Court emphasized that Section 75(4) mandates an opportunity of hearing when an adverse decision is contemplated, even without a specific request. Consequently, assessment orders passed without granting a personal hearing under Section 75(4) were set aside. The matters were remitted to the respective Assessing Officers to issue notices for affording an opportunity of personal hearing and to pass orders within three months or the remaining limitation period, whichever is later. For cases where a personal hearing was afforded, the Court found no reason to interfere and rejected the writ petitions.

Facts

Multiple petitioners, including M/s Barhonia Engicon Private Limited, Vinod Singh, M/s Anand Consultant, Technoculture Building Centre Pvt Ltd, M/s Devendra Prasad, M/s Shankar Traders, M/s Nirav Enterprises, M/s Harilal Ventures Private Limited, and others, filed writ petitions before the Patna High Court. The petitions challenged various orders passed by GST authorities. Key issues raised by the petitioners pertained to the limitation period for assessment, the procedure for scrutiny of returns under Section 61 and Rule 99, and the requirement of a personal hearing under Section 75(4) before passing adverse orders. The revenue authorities were the respondents, including the State of Bihar and the Union of India, represented by various tax departments and officers.

Key Issues

1. Whether the limitation period for assessment under the GST Act is extended by the period excluded by the Hon'ble Supreme Court's orders, and further by any notifications issued by the respective governments? (Question of law) 2. Whether proceedings under Section 73 of the GST Act can be initiated without first undertaking a scrutiny of returns under Section 61 and issuing a notice in Form-GST ASMT-10, and considering the assessee's explanation? (Question of mixed law and fact) 3. Whether an opportunity of personal hearing must be granted under Section 75(4) of the GST Act when a reply has been submitted to a notice issued under Section 73 and an adverse decision is contemplated, even without a specific request for a hearing? (Question of law) Petitioner's arguments: - The limitation period for assessment should be extended by the periods excluded by the Supreme Court and any government notifications. - Proceedings under Section 73 must be preceded by scrutiny under Section 61 and a proper notice and consideration of explanation. - Section 75(4) mandates a personal hearing when an adverse decision is contemplated, irrespective of whether a request is made. Revenue's arguments: - Not explicitly recorded in the provided text, but implicitly, the revenue likely contended that the assessment orders were validly passed within the prescribed procedures and limitations.