M/S Temple Design vs. Principal Chief Commissioner, Central Goods And Service Tax

Petitioner has sought for quashing of the order dated 31.12.2020 passed by the third respondent, whereby the GST registration certificate issued to the petitioner has been cancelled and same has been affirmed by the Commissioner (Appeals) dismissing the Appeal GAPPL/ADC/GSTP/551/2021-Appeal/25 by order dated 31.3.2022. 2. We have heard the argument of Mr.Manan K.Paneri, learned counsel appearing for the petitioner and Mr.Priyank P.Lodha, learned counsel appearing for the respondents nos.1 and 2. We have perused the records.

Petitioner was issued a registration certificate by the respondent authority and returns came to be filed initially for a period of two months commencing from December 2019. On the onset of the pandemic, namely, Covid-19, petitioner is said to have filed monthly returns as required under Section 29(2)(c) of the GST Act initially and later on could not due to Covid-19. Hence, a show-cause notice was issued to the petitioner on 18.12.2020 (Annexure-G), calling upon the petitioner to appear before the authority on 23.12.2020 at 12:07 p.m. and also directed the petitioner to furnish its reply. Petitioner claims to have received the said show-cause notice after the hearing date. Hence, he claims to have not attended the proceedings which was held on 23.12.2020. Even otherwise, the impugned order dated 31.12.2020 (Annexure-C) would disclose that registration has been cancelled without opportunity being extended. It is interesting to note at this juncture itself that under the impugned order respondent authority refers to a purported reply dated 30.12.2020 said to have been submitted by the petitioner C/SCA/8394/2022 JUDGMENT DATED: 29/06/2022 in response to the show-cause notice dated 18.12.2020 which has not been factually submitted by petitioner. It would also indicate that authority cancelled the registration certificate to the petitioner having examined the reply and submissions made at the time of the hearing which factually did not exist. This is not only completely erroneous, misconceived, but also bereft of truth and we say so for the simple reason that petitioner having asserted in the petition that he never replied to the show-cause notice and having never appeared before the respondent authority and said plea having remained uncontroverted, it cannot be gainsaid by respondent that petitioner had been afforded opportunity before passing of the impugned order. In fact, the prime challenge by the petitioner to the impugned order dated 31.12.2020 is on the ground of opportunity having not been extended to furnish its reply to the show-cause notice. Respondent’s counsel has failed to place on record either the reply submitted by the petitioner as claimed under the impugned order or the records and proceedings of the respondent authority disclosing petitioner having appeared before the authority on the hearing date, i.e. either on 23.12.2020 or subsequently on 31.12.2020. In the absence of any positive material available on record, no inference can be drawn on the basis of mere assertion by the respondent’s counsel, particularly when petitioner has clearly made a statement on oath that he had not replied to the show-cause notice and he had not appeared on the hearing date, since the show-cause notice was received after the hearing date, which was fixed as 23.12.2020. Incidentally, impugned order would also indicate that petitioner had not turned up for personal hearing. This would take us to the question as to whether first statement recorded under the impugned order is to be believed or the second statement recorded under the C/SCA/8394/2022 JUDGMENT DATED: 29/06/2022 impugned order is to be accepted. One is contrary to the other. This itself would clearly go to show that there is non-application of mind by the respondent authority while passing the impugned order.

Being aggrieved by this order, petitioner, instead of approaching this Court invoking extraordinary juri iction on the ground of violation of principles of natural justice, had knocked the doors of the Commissioner (Appeals) by availing the alternate remedy available under law. The appellate authority, without taking into consideration the aforestated facts, has knocked down the appeal on the ground of delay in approaching the appellate authority. We are of the view that appellate authority was required to condone the delay in view of the issue of limitation having been extended by Hon’ble Apex Court in a suo motu Writ Petition No.3/2020 by its order dated 10.1.2022 and subsequently extended from time to time. However, appellate authority seems to have gone in tangent, or in other words, has not taken a lenient view in condoning the delay inasmuch as no litigant would stand to benefit in approaching the court belatedly. Though Mr.Priyank Lodha has made a valiant attempt to contend that even if this Court were to arrive at the conclusion that impugned orders are liable to be quashed, he has prayed for the matter being remitted to the first appellate authority which we are not inclined to do so inasmuch as the original authority itself having committed a serious error in passing the impugned order dated 31.12.2021, for the reasons already recorded herein above, it cannot be said that matter is required to be remanded to the first appellate authority. On the other hand, when the original authority itself has committed a serious error in passing the impugned order dated 31.12.2020, C/SCA/8394/2022 JUDGMENT DATED: 29/06/2022 necessarily by setting aside the impugned order, matter was required to be remitted to the original authority, namely, respondent no.3. 5. Hence, we proceed to pass the following O R D E R (i) The Special Civil Application is allowed with costs. (ii) The impugned order dated 31.12.2020 (Annexure-C) as well as order dated 31.3.2022 (Annexure-H) passed by the Commissioner (Appeals) are hereby set-aside and matter is remitted to the third respondent with a direction to adjudicate the claim of the petitioner taking note of the observations made herein above. (iii) Respondent to pay to the petitioner a sum of Rs.5,000=00. (ARAVIND KUMAR, CJ.) (NISHA M. THAKORE, J.) /MOINUDDIN