Devendra Sah vs. The Union Of INDIA

Facts

The petitioner, Devendra Sah, challenged an order dated March 8, 2020, passed by the Assistant Commissioner, State Tax Supaul Circle, imposing tax, interest, and penalty under Section 73 of the Bihar Goods and Services Tax Act, 2017. The petitioner contended that the order was passed without affording the statutory 30-day period mentioned in the show cause notice dated February 8, 2020, which granted time until March 8, 2020. The final order was issued on March 8, 2020, violating Section 73(8) and principles of natural justice. The petitioner also challenged the consequential DRC-07 for Rs. 447381.16 and an appellate order dated July 5, 2021, which rejected his appeal ex-parte. The High Court noted that the minimum statutory period of 30 days under Section 74(A) of the CGST/BGST Act, 2017, was not afforded.

Held

The Court held that the minimum statutory period of 30 days mandated under Section 74(A) of the CGST/BGST Act, 2017, was not afforded to the petitioner. The show cause notice dated February 8, 2020, directed the petitioner to file a reply on March 8, 2020, but the final order was passed on the same day, which was within the 30-day period. This was a violation of the mandate of law. Furthermore, the appellate order dated July 5, 2021, rejecting the petitioner's appeal ex-parte without considering his contentions, was also found to be erroneous. Consequently, the Court quashed the show cause notice, the order of assessment, and the appellate order. The Court directed the assessing officer to issue a fresh notice in light of statutory provisions and pass an appropriate order in accordance with law, complying with principles of natural justice. The Court also directed the de-freezing of the petitioner's bank accounts and stipulated conditions for further deposits and expeditious disposal of the case.

Key Issues

1. Whether the order dated March 8, 2020, passed by the Assistant Commissioner, State Tax Supaul Circle, is liable to be set aside for violating the statutory period of 30 days mandated under Section 73(8) of the Bihar Goods and Services Tax Act, 2017, and principles of natural justice? Petitioner's Argument: The petitioner argued that the show cause notice dated February 8, 2020, granted time until March 8, 2020, but the final order was passed on the same day, failing to provide the statutory 30-day period. This violated Section 73(8) of the BGST Act and the principles of natural justice. The subsequent appellate order rejecting the appeal ex-parte was also challenged. Revenue's Argument: The judgment does not record any specific arguments made by the respondents (Union of India and State of Bihar) on the merits of the petitioner's contentions regarding the violation of statutory timelines and principles of natural justice.