M/S S.P. Singla Constructions(Jv) vs. The State Of Bihar

Held

The Court held that the ex-parte order of assessment could not survive. It found that the impugned order did not indicate that the petitioner was informed of the next date of hearing after their adjournment request, nor did it show that any further date was fixed by the adjudicating authority after the rejection of the adjournment request, if any. The Court considered the submissions of both parties and the provisions of Section 75(5) of the CGST Act, 2017. The Court concluded that the order was passed without providing an adequate opportunity of hearing to the petitioner. Consequently, the impugned order dated January 31, 2025, was set aside, and the matter was remanded back to the adjudicating authority for passing a fresh order after granting an opportunity of hearing to the petitioner within a period of two months.

Facts

The petitioner, M/s S.P. Singla Constructions (JV), filed a writ application challenging an Order for Demand dated January 31, 2025, and a Summary of Order dated February 4, 2025, passed by the Assistant Commissioner of State Tax, Patna Central-1. These orders imposed a tax liability of Rs. 98,83,232/- on the petitioner. A show cause notice was issued on November 11, 2023. The petitioner filed a reply and an adjournment request in Form GST DRC-06 on December 11, 2023. The petitioner contends that the respondent authority passed the final order without rejecting the adjournment request, without fixing a further date of hearing, and without providing an adequate opportunity of hearing, rendering the order ex-parte. The State argued that there was a significant time gap between the show cause notice and the order, and the petitioner was not vigilant in ascertaining the next hearing date.

Key Issues

1. Whether the impugned order of assessment, passed without explicitly rejecting the petitioner's adjournment request and without fixing a further date of hearing, violates the principles of natural justice and the provisions of Section 75(5) of the CGST Act, 2017? Petitioner's arguments: The petitioner argued that Section 75(5) of the CGST Act, 2017, entitles an assessee to at least three adjournments upon showing sufficient cause, and the authority has a duty to record reasons for rejecting an adjournment. The petitioner asserted that their adjournment request in DRC-06 was not rejected, no further date was fixed, and the final order was passed ex-parte, despite the petitioner disputing any telephonic intimation of a hearing date. Revenue's arguments: The respondent-State argued that a considerable time gap existed between the show cause notice and the final order, and the petitioner failed to demonstrate sufficient vigilance in ascertaining the next hearing date or appearing before the adjudicating authority during that period.