Devendra Sah vs. The Union Of INDIA

Facts

The petitioner, Devendra Sah, challenged an order dated 08.03.2020 passed by the Assistant Commissioner, State Tax, Supaul, for the month of July 2018. This order imposed 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 stipulated in Section 73(8) of the Act and in violation of the principles of natural justice, as the final order was dated 08.03.2020, while the last date for submitting a reply was 11.03.2020. A consequential demand notice (DRC-07) for Rs. 22,89,790.10 was also challenged. Subsequently, an appeal filed by the petitioner against the assessment order was rejected ex-parte by the Additional Commissioner (Appeal) on 05.07.2021 without a hearing.

Held

The Court held that the statutory period of 30 days mandated under Section 74(A) of the CGST/BGST Act, 2017, was not afforded to the petitioner for making payment. The assessing officer proceeded to pass an ex-parte order prior to the expiry of this 30-day period. Specifically, the notice dated 11.02.2020 directed the petitioner to file a reply by 11.03.2020, but the final order was passed on 08.03.2020, which was within the 30-day period. The Court found that the law mandates that a 30-day period must be afforded to the parties, which was not done. Furthermore, the appeal against the final order was rejected ex-parte without considering the petitioner's contentions. On these grounds, the Court quashed the notice dated 11.02.2020, the assessment order dated 08.03.2020, and the appellate order dated 05.07.2021. 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 the law, ensuring full compliance with all proceedings.

Key Issues

1. Whether the order dated 08.03.2020, passed by the Assistant Commissioner, State Tax, Supaul, is liable to be set aside for violation of Section 73(8) of the Bihar Goods and Services Tax Act, 2017, and the principles of natural justice, by not affording the statutory 30-day period for reply and passing the order before the due date for reply? 2. Whether the appellate order dated 05.07.2021, passed by the Additional Commissioner (Appeal), is liable to be set aside for being passed ex-parte without providing a hearing to the petitioner? Petitioner's arguments: The petitioner argued that the Assistant Commissioner passed the assessment order on 08.03.2020, which was prior to the stipulated reply date of 11.03.2020, and before the expiry of the mandatory 30-day period under Section 73(8) of the BGST Act. This, coupled with the ex-parte rejection of the appeal without a hearing, constituted a violation of natural justice. The petitioner relied on the statutory mandate of Section 73(8) and the principles of natural justice. Revenue's arguments: The judgment does not record any specific arguments made by the respondents.