M/S. Bhavadharani Builders vs. The Deputy Commissioner Of CGST And Central Excise

Held

The Court held that the impugned assessment order dated April 20, 2023, was liable to be set aside as it was passed in gross violation of the principles of natural justice. The Court found that the respondents' reliance on the Division Bench order granting 60 days for reply was erroneous, as the said order also provided for 90 days for passing final orders, and more importantly, it could not be cited as a reason to decline an adjournment when the assessee was seeking it due to severe illness and medical treatment. The Court reasoned that the petitioner's medical condition, including hospitalization for cancer, warranted consideration, and it was unreasonable to expect them to appear or instruct representatives without adequate time. The Court directed the petitioner to submit their reply within one month of receiving the order. Upon receipt of the reply, the respondents were to fix a personal hearing date and intimate it to the petitioner, with the petitioner being directed not to seek further adjournments. As a condition for this relief, the petitioner was directed to deposit Rs. 2,00,000/- in two installments.

Facts

The petitioner, M/s.Bhavadharani Builders, a government works contractor, filed a writ petition challenging an assessment order dated April 20, 2023, passed by the Assistant Commissioner of CGST and Central Excise, Madurai-II Division. The petitioner contended that they were not given sufficient opportunity to file a reply to the show cause notice and sought to quash the order and direct a re-do of the assessment with a personal hearing. The petitioner had sought adjournments due to illness and hospitalization, providing medical certificates. The respondents argued that a Division Bench order mandated a 60-day period for reply after the show cause notice, and they were constrained to pass the final order within that timeframe, citing potential contempt proceedings if they deviated. The petitioner's counsel argued that the petitioner's severe illness prevented their appearance or proper instruction of representatives.

Key Issues

1. Whether the impugned assessment order dated 20.04.2023 is illegal and a gross violation of the principles of natural justice due to the denial of sufficient opportunity for personal hearing and filing a reply to the show cause notice, particularly in light of the petitioner's severe medical condition? (Question of law and fact, turning on principles of natural justice and procedural fairness). Petitioner's arguments: The petitioner argued that despite multiple requests for adjournment due to severe illness, including hospitalization for cancer treatment, the respondents failed to provide adequate opportunity to file a reply and attend a personal hearing. They emphasized that their medical condition prevented them from appearing or instructing representatives effectively. They sought to quash the order and have the assessment redone with proper opportunity. Respondents' arguments: The respondents contended that they were bound by a Division Bench order which stipulated a 60-day period from the issuance of the show cause notice for filing a reply. They argued that failing to adhere to this timeline could lead to contempt proceedings, and therefore, they were constrained to pass the final order, refusing further adjournment. They also suggested the petitioner could have directed representatives to appear.