Messers Sreema Rice Mill, (Partnership Firm) vs. Union Of INDIA And Ors.
Original PDF →Facts
The petitioner, Messers Sreema Rice Mill, filed a writ petition challenging an order dated December 29, 2023, passed under Section 73(9) of the West Bengal/Central Goods and Services Tax Act, 2017, for the tax period July 2017 to March 2018. The petitioner contended that neither the show cause cum demand notice dated September 21, 2023 (DRC-01) nor the adjudication order dated December 29, 2023 (DRC-07) were uploaded on the common GST portal. The petitioner argued that this non-uploading denied them the statutory right to appeal. The respondents submitted that the show cause notice was served via speed post and the petitioner had replied and attended a personal hearing, constituting substantial compliance. They also stated the adjudication order was uploaded on May 20, 2024.
Held
The Court held that while Rule 142(1) and 142(5) of the West Bengal Goods and Services Tax Rules, 2017, mandate the uploading of the show cause notice (DRC-01) and adjudication order (DRC-07) on the common portal, the non-uploading does not automatically vitiate the proceedings if there has been substantial compliance. The Court found that the show cause notice was duly served on the petitioner by speed post, and the petitioner had responded and participated in a personal hearing. This was considered substantial compliance with the statutory provisions for service of notice, as Section 169 of the Act allows for service via speed post. The Court noted that the petitioner could not identify any prejudice caused by the non-uploading of the show cause notice. However, regarding the adjudication order, the Court acknowledged that its non-uploading would prevent the petitioner from filing an appeal. Since the respondents submitted that the order was uploaded on May 20, 2024, the Court directed that if it was not yet uploaded, it should be done within 7 days. The petitioner was permitted to pursue their statutory remedy of appeal within three months from the judgment date or the order's upload date, whichever is later, upon depositing the requisite fees. The appellate authority was directed to hear the appeal on merits, including the point of limitation, and the Court explicitly stated it had not gone into the merits of the matter.
Key Issues
1. Whether the non-uploading of the show cause notice (DRC-01) and the adjudication order (DRC-07) on the common GST portal vitiates the proceedings, despite service through other means, under Section 73 and Rule 142 of the West Bengal Goods and Services Tax Rules, 2017? Petitioner's Arguments: The petitioner argued that it is mandatory to upload both the show cause notice and the adjudication order on the common portal as per Rule 142(1) and 142(5) of the said Rules. Non-compliance with this rule, particularly the non-uploading of the adjudication order, denies the petitioner their statutory right to appeal, which cannot be taken away. They relied on a communication dated November 23, 2023, from the Principal Commissioner GST regarding the obligation to upload the show cause notice. Respondents' Arguments: The respondents contended that the show cause notice was served on the petitioner through speed post, and the petitioner had responded to it and availed a personal hearing. They argued that this constituted substantial compliance with Section 169 of the Act, and mere non-uploading on the portal does not vitiate the proceedings. They also submitted that the adjudication order was uploaded on May 20, 2024, enabling the petitioner to file an appeal.
Sections Cited
Section 73, Section 73(1), Section 73(9), Section 107, Section 169, Rule 142, Rule 142(1), Rule 142(5)
AI-generated summary — verify with the full judgment below
Form No.J(2)
IN THE HIGH COURT AT CALCUTTA CONSTITUTIONAL WRIT JURI ICION APPELLATE SIDE Present:
The Hon’ble Justice Raja Basu Chowdhury
W.P.A 11892 of 2024 Messers Sreema Rice Mill Versus Union of India & Ors.
For the petitioner
: Mr. Siddhartha Dasgupta
Mr. Souvik Guha
Mr. Palash Majumder
For the respondents
: Mr. Bhaskar Prasad Banerjee
Ms. A. Rajyashree
Mr. C. G. Kamal
Heard on
: 2nd July, 2024
Judgment on
: 2nd July, 2024
Raja Basu Chowdhury, J:
The present writ petition has been filed, inter alia, challenging the order dated 29th December, 2023 passed under Section 73(9) of the West Bengal/Central Goods and Services Tax Act, 2017 (hereinafter referred to as the “said Act”), for the tax period July 2017 to March, 2018. 2. The petitioner contends that it is the petitioner’s case that neither the show cause cum demand notice dated 21st
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September, 2023 issued under Section 73 of the said Act in DRC-01 nor the adjudication order dated 29th December, 2023 passed by the proper officer issued under Section 73(9) of the said Act in form DRC-07 was uploaded on the common portal.
Mr. Dasgupta, learned advocate representing the petitioner by placing reliance on a communication dated 23rd November, 2023 issued by the Principal Commissioner GST submits that it is the obligation of the proper officer prior to passing an adjudication order under Section 73(9) of the said Act to issue a show cause notice under Section 73(1) of the said Act and to upload the same in Form DRC-01 on the common portal.
Admittedly, in this case the show-cause notice in Form DRC- 01 had not been uploaded in the common portal. He submits that the respondents by not uploading the adjudication order in Form DRC-07 dated 29th December, 2023 has also denied the petitioner the right to challenge the same by filing an appeal. Right to prefer an appeal is a statutory right which cannot be taken away.
In the circumstance, as aforesaid, it is submitted that this Hon’ble Court may be pleased to set aside not only the adjudication order passed under Section 73(9) of the said Act dated 29th December, 2023 but also the show cause notice dated 21st September, 2023, issued under Section 73(1) of the said Act.
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Mr. Banerjee, learned advocate representing the respondents on the other hand by referring to the order dated 29th December, 2023 submits that although, the show cause cum demand notice dated 21st September, 2023 was not uploaded on the common portal due to the technical reasons, yet in terms of the provisions contained in Section 169 of the said Act, the show-cause notice had been served on the petitioner through speed post. The petitioner in response to the said show cause notice not only filed its reply on 10th October, 2023 but also availed the opportunity of personal hearing on 20th November, 2023. Having regard to the aforesaid it is submitted that mere non-uploading of a show cause notice on the common portal does not have the effect of vitiating the entire proceeding, especially when the said show cause notice was duly served on the petitioner and the petitioner had also responded to the same.
Mr. Banerjee, by placing a print out of copy of e-mail communication dated 20th May, 2024 which is taken on record, submits that the order in DRC 07 has been uploaded on the portal on 20th May, 2024. Having regard to the aforesaid, it is submitted that in the light of the order dated 29th December, 2023 in Form DRC-07 being uploaded, there cannot be any difficulty on the part of the petitioner to prefer an appeal.
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Mr. Dasgupta, in response, submits that to the petitioner’s knowledge, the order dated 29th December, 2023 in form DRC- 07 is yet to be uploaded.
Heard the learned advocates appearing for the respective parties and considered the materials on record. In the instant case it would be apparent from the records that the show cause notice dated 21st September, 2023 in DRC-01 for the tax period July, 2017 to March, 2018 was not uploaded in the common portal. As correctly pointed out by Mr. Dasgupta, the Rule 142(1) of the West Bengal Goods and Services Tax Rules 2017 (hereinafter referred to as the “said Rules”) read with Rule 142(5) of the said Rules requires not only the show-cause notice but also the adjudication order to be uploaded in forms DRC-01 and DRC-07 respectively on the common portal. According to Mr. Dasgupta, unless the aforesaid show cause notice and the adjudication order are uploaded on the common portal, no effect can be given thereto.
It is true, that in absence of the registered tax payer being made aware with regard to the show cause in the manner provided in Rule 142(1) of the said Rules, the registered tax payer may be denude the opportunity to appropriately respond to the same. But in the instant case, it is noticed that the show cause notice was duly served on the petitioner by speed post. The petitioner had also responded to 5
the same and was also afforded an opportunity of personal hearing. It may be relevant to note that Section 169 of the said Act specifies that the notices are required to be served in the mode and manner as provided for therein. I find that one of the modes for service of notice is to make the same available on common portal while one of the other modes for service is by registered/speed post. Admittedly, since, the petitioner had been served with the show-cause notice by speed post and the petitioner having responded to the same, the above in my view, constitutes substantial compliance of statutory provision as regards service of notice. Having regard to the above, the show- cause notice or the order does not get vitiated simply because the same had not been uploaded on the common portal. Mr. Dasgupta, learned advocate representing the petitioner could not identify any prejudice caused to the petitioner for reasons of the show cause notice not being uploaded on the common portal. Insofar as, the adjudication order dated 29th December, 2023 issued under Section 73(9) of the said Act is concerned, I must say that in absence of such disclosure, the petitioner could not have challenged the same by preferring an appeal. Since today, at the time of hearing by placing reliance on the communication dated 20th May, 2024, it has been submitted that the order passed under Section 73(9) of the said Act dated 29th December, 2023 has been uploaded on the common portal
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only on 20th May, 2024, I am of the view that the petitioner should be permitted to pursue its statutory remedy. If, however, for any reason the said order is yet to be uploaded, the respondents should forthwith upload the same on the portal positively within a period of 7 days from date.
In the event, the petitioner files an appeal from the aforesaid order within a period of three months, from the date of passing of this judgment and order or within three months from the date of uploading the order on the common portal whichever is later, by depositing requisite fees as is required for maintaining the appeal under Section 107 of the said Act, such appeal shall be heard and disposed of on merits by the appellate authority, upon giving an opportunity of personal hearing to the petitioner.
It is made clear that this Court has not gone into the merits of the matter. It would be open to the appellate authority to decide all points as may be raised by the petitioner, including the point of limitation, if any.
With the above observations and directions, the writ petition stands disposed of.
There shall be no order as to costs.
Urgent Photostat certified copy of this order, if applied for, be made available to the parties upon compliance of requisite formalities.
(Raja Basu Chowdhury, J.) SB
Reproduced from the public record of the Calcutta High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.