Sunita Jalan vs. Asst. Commissioner , Beliaghata Charge& Ors

Held

The Court held that the writ petition was not maintainable at such a belated stage (August 2020, after receiving the order in February 2020) due to the availability of alternative efficacious remedies under the statute. The Court noted that while no hearing was given and the cancellation order was not speaking, the petitioner had moved the High Court after a significant delay. The Court referred to Sections 30 and 107 of the GST Act, which provide for revocation of cancellation and appeals, respectively. The Court clarified that the petitioner would be required to pay only the amount shown in his returns, refuting the apprehension of depositing the entire claim. The Court directed the petitioner to exhaust the available statutory remedies, emphasizing that fiscal statutes should be strictly construed, and courts should be slow to interfere when public revenue is involved and alternative remedies exist. If the petitioner pursues the statutory remedy, the authority must consider all aspects, including the failure to provide an opportunity of hearing and the petitioner's submission that the report forming the basis of the order was not provided.

Facts

The petitioner, Sunita Jalan, operating as SAWARIYA STEEL INDUSTRIES, received a show cause notice dated February 4, 2020, proposing cancellation of her GST registration due to being non-functional at her principal place of business. The notice required a reply within 7 days, failing which the case would be decided ex parte. An order cancelling the registration with retrospective effect from October 26, 2019, was passed on February 14, 2020. The petitioner contended that the show cause notice was vague and no opportunity for a personal hearing was provided. Aggrieved, the petitioner filed a writ petition before the High Court in August 2020, after receiving the cancellation order.

Key Issues

1. Whether the writ petition is maintainable before this Court, given the alternative remedies available under the Goods and Services Tax Act, 2017? 2. Whether the show cause notice dated February 4, 2020, was sufficiently clear and whether the order of cancellation dated February 14, 2020, was passed without affording a proper opportunity of hearing to the petitioner? The petitioner argued that the show cause notice was vague and the cancellation order was passed retrospectively without a hearing. The State, represented by the learned Additional Advocate General, contended that the petitioner had not exhausted the alternative remedies prescribed under Sections 29, 30, and 107 of the GST Act and Rule 23(1) of the GST Rules. The State argued that the show cause notice clearly stated the reason for cancellation and that the petitioner's failure to reply led to an ex parte decision, implying the petitioner was not interested in contesting the proceedings. The State also refuted the petitioner's apprehension that the entire claim would need to be deposited to pursue the alternative remedy.