M/S. Motiprabha Infrated PVT. LTD. vs. The Union Of INDIA

Held

The Court held that the assessment order dated 24.02.2021 and the demand order in DRC-07 dated 24.02.2021 were passed in violation of the statutory mandate under Section 73(8) of the CGST/BGST Act, 2017. The Court noted that the notice dated 15.02.2021 directed the petitioner to file a reply on 21st February 2021, which was within the 30-day period, but the assessing officer proceeded to pass the ex-parte order prior to the expiry of this mandatory 30-day period. The Court found that the minimum statutory period of 30 days was not afforded to the petitioner. Therefore, on this ground alone, the Court quashed the notice dated 15.02.2021 and the assessment order dated 24.02.2021. The Court directed the assessing officer to issue a fresh notice in light of the statutory provisions and pass an appropriate order in accordance with law. The Court also noted the petitioner's undertaking to cooperate fully. The appellate order was not explicitly discussed in the reasoning for the quashing of the initial orders, but the overall allowance of the petition implies its setting aside or reconsideration.

Facts

The petitioner, M/s. Motiprabha Infrated Pvt. Ltd., challenged an ex-parte assessment order dated February 24, 2021, passed by the Assistant Commissioner State Taxes (Respondent No. 7) for the Financial Year 2019-20. This order imposed a total liability of Rs. 2,50,37,577, including IGST, CGST, and SGST, along with interest. The petitioner also challenged a demand order in Form DRC-07 issued on the same date for FY 2018-19, which was allegedly passed before the statutory 30-day notice period under Section 73(8) expired. The petitioner further challenged an appellate order dated September 28, 2022, passed by the Additional Commissioner of State Taxes (Appeals) (Respondent No. 5), which rejected their appeal on grounds of delay. The petitioner sought quashing of these orders and a direction for a fresh assessment considering their invoices and GSTR-3B, GSTR-2A, and GSTR-9 mappings.

Key Issues

1. Whether the assessment order dated 24.02.2021 and the demand order in DRC-07 dated 24.02.2021 are bad in law due to violation of Section 73(8) of the CGST/BGST Act, 2017, which mandates a minimum 30-day notice period, when the DRC-01 notice was issued on 15.02.2021 and the impugned orders were passed merely 9 days later? 2. Whether the appellate order dated 28.09.2022 is liable to be quashed as it rejected the appeal on the ground of delay without considering the merits of the case? Petitioner's Arguments: The petitioner argued that the assessment order and DRC-07 were passed in violation of Section 73(8) of the CGST/BGST Act, 2017, as they were issued within 9 days of the notice dated 15.02.2021, failing to provide the mandatory 30-day period. They contended that the appellate order was also illegal for rejecting the appeal on delay without examining the merits and supporting materials uploaded on the GST portal. The petitioner also claimed that the rejection of Input Tax Credit (ITC) and imposition of interest worth Rs. 44,68,807 for the difference between GSTR-3B and GSTR-2A was illegal without an opportunity of hearing. They sought a refund of Rs. 20,56,878 deposited as pre-deposit for the appeal. Revenue's Arguments: The judgment records no specific arguments from the revenue side.