Ssb Petro Products And Ors vs. Assistant Commissioner State Tax Shibpur Charge And Ors

Facts

The appellants, SSB Petro Products & Ors., challenged an order dated 21.11.2022 by the Senior Joint Commissioner, State Tax, Howrah Circle, which rejected their appeal as time-barred. The appellants were initially served with an intimation of tax payable under Sections 73(5) and 74(5) of the GST Act in Form GST DRC-01A on 05.03.2021 by the first respondent. They filed a reply on 08.03.2021, but the matter was not adjudicated. Subsequently, the second respondent issued Form GST DRC-01 on 16.09.2021, a summary of the show cause notice. The appellants claimed they were unaware of this notice being uploaded to the portal and only discovered it when Rs. 1,84,930/- was debited from their electronic credit ledger. By then, the limitation period for filing an appeal had expired.

Held

The Court held that the appeal should not be treated as time-barred, considering the peculiar facts and circumstances. The Court reasoned that the appellants had responded to the initial intimation dated 05.03.2021, and their reply dated 08.03.2021 was not considered or disposed of. Therefore, the issue of whether the appellants noticed the uploading of Form GST DRC-01 dated 16.09.2021 became academic. The Court found that the preliminary proceedings could not have been initiated by the second respondent when the proceedings initiated by the first respondent for the same amount and allegations were pending and not concluded. The Court decided that the appeal should be decided on merits. The appeal and writ petition were allowed, the order of the appellate authority was set aside, and the appeal was restored to the file of the appellate authority for disposal on merits. The Court also directed that any excess amount debited from the electronic credit ledger should be re-credited, to be considered by the appellate authority, and that the appellants would be afforded an opportunity of personal hearing.

Key Issues

1. Whether the second respondent could initiate fresh proceedings when the first respondent was already seized of the matter concerning the same amount and allegations, and the initial proceedings were not concluded? (Section 74 of the GST Act). The appellants argued that the second respondent could not initiate fresh proceedings as the first respondent had initiated proceedings for the same cause of action, to which the appellants had responded, and these proceedings were not taken to a logical end. They contended that the first respondent's proceedings were only closed on 24.01.2023, after the appeal against the second respondent's proceedings was already pending. The revenue or State argued that the appeal was hopelessly time-barred and the appellate authority had no power to condone the delay.