Joy Matara Educational Institute vs. Pharmacy Council Of INDIA
Held
The Court held that the impugned Show Cause Notice (SCN) was unsustainable because it did not clearly specify the grounds for the proposed demand. The Court also found the procedure flawed, as the personal hearing was scheduled before the deadline for the petitioner to file its reply, rendering the opportunity for hearing a mere formality rather than a chance to canvas its case. The Court noted that the petitioner's reply, which was extensive and addressed the audit observations, was not considered by the concerned officer before passing the impugned order. The Court rejected the revenue's contention that the petitioner did not opt for a personal hearing, as the reply clearly requested an opportunity to be heard. Consequently, the Court set aside the impugned order and the SCN. The Court directed the concerned officer to consider the petitioner's response and pass a fresh order after affording the petitioner a due opportunity to be heard. The ratio decidendi is that a show cause notice must clearly state the grounds for demand, and a personal hearing must be meaningful, allowing the assessee to present their case after filing a reply.
Facts
The petitioner, HT Media Limited, filed a writ petition challenging an order dated 03.04.2023 passed by respondent No. 2 and a Show Cause Notice (SCN) dated 01.08.2022 issued under Section 73 of the Delhi Goods and Services Tax Act, 2017. The SCN alleged that tax was not paid, short-paid, refund was erroneously released, or input tax credit was wrongly availed, but it did not disclose detailed reasons for the proposed demand. The petitioner was given a reply deadline of 01.09.2022 and a personal hearing on 19.08.2022, which was prior to the reply date. The petitioner submitted a 39-page reply on 01.09.2022, responding to an audit report and requesting a hearing. The concerned officer did not afford a further hearing and passed an order raising a demand of ₹29,17,30,644/-, without considering the petitioner's submissions or providing reasons.
Key Issues
1. Whether the impugned Show Cause Notice dated 01.08.2022, issued under Section 73 of the Delhi Goods and Services Tax Act, 2017, sufficiently disclosed the grounds for the proposed demand? 2. Whether the impugned order dated 03.04.2023, passed under Section 73 of the Act, is sustainable in law, considering that the petitioner's reply was not considered and a proper opportunity of being heard was not afforded? Petitioner's arguments: The petitioner contended that the SCN lacked specific grounds for the proposed demand and that the personal hearing was scheduled before the deadline for filing the reply. Furthermore, the petitioner argued that its detailed reply was not considered by the authority before passing the impugned order, and no proper opportunity for a hearing was provided. Revenue's arguments: The respondent's counsel stated that a personal hearing was offered on 19.08.2022, but no one attended, and that the petitioner had not opted for a personal hearing. However, the respondent did not dispute the authenticity of the documents filed by the petitioner.
Sections Cited
Section 73
AI-generated summary — verify with the full judgment below
W.P.(C) 8787/2023 $~16 * IN THE HIGH COURT OF DELHI AT NEW DELHI %
Date of Decision: 11th July, 2023 + W.P.(C) 8787/2023 & CM APPL. 33163/2023 HT MEDIA LIMITED
..... Petitioner Through: Mr. Bharat Raichandani and Mr. Deepak Kumar Khokhar, Advs. versus UNION OF INDIA & ORS.
..... Respondents Through: Mr. Siddharth Khatana, Senior Panel Counsel for R-1 / UOI. Mr. Satyakam, ASC for R-3 and 4. Ms. Anushree Narain, Standing Counsel for R-5. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE AMIT MAHAJAN VIBHU BAKHU, J.
The petitioner has filed the present petition impugning an order dated 03.04.2023 (hereafter ‘impugned order’) passed by respondent No. 2. 2. The petitioner also impugns the Show Cause Notice dated 01.08.2022 (hereafter ‘impugned Show Cause Notice’) issued under Section 73 of the Delhi Goods and Services Tax Act, 2017 (hereafter ‘the Act’).
It is material to note that the impugned Show Cause Notice alleges that “tax has not been paid or short paid or refund has been released erroneously or input tax credit has been wrongly availed”, Signing Date:15.07.2023 18:42:18 Signa
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