M/S.Shubhankar Facility Managers Private Limited vs. The Additional Commissioner

Facts

The petitioner, M/s. Shubhankar Facility Managers Private Limited, challenged an Order-in-Original dated January 31, 2022, passed by the Additional Commissioner, Ranga Reddy GST Commissionerate. This order confirmed a demand of Rs. 63,96,598.00, along with interest and penalty, for the period 2015-16 to 2017-18 (up to June 2017). The petitioner contended that the order was passed without serving show cause notices dated December 2, 2021, December 17, 2021, and January 13, 2022, and without providing an opportunity for personal hearing. The respondents, represented by their counsel, admitted that they had no proof of service of these notices on the petitioner. The impugned order itself did not mention any service of notice on the petitioner.

Held

The Court held that the issuance of a show cause notice and a notice of personal hearing to a dealer or taxable person is insufficient; the notice must be served, and this service must be reflected in the order-in-original. The Court noted that the impugned order-in-original dated January 31, 2022, contained no mention of service of notice upon the petitioner. Consequently, the Court set aside the impugned order-in-original. The matter was remanded back to the file of Respondent No. 1. The Court construed the present writ petition order as a notice to show cause for the petitioner, directing them to submit a reply within three weeks. Upon receipt of the reply, Respondent No. 1 is to pass an appropriate order in accordance with law after affording the petitioner due opportunity of hearing, including personal hearing. All contentions were kept open. If no reply is filed by the petitioner, Respondent No. 1 is at liberty to pass an order as deemed fit. The writ petition was allowed.

Key Issues

1. Whether the Order-in-Original dated January 31, 2022, passed by the Additional Commissioner, Ranga Reddy GST Commissionerate, is arbitrary, contrary to law, and in violation of the principles of natural justice and the rule of law, specifically concerning the non-service of show cause notices and personal hearing notices on the petitioner for the tax period 2015-16 to 2017-18 (up to June 2017)? (Question of law and fact, concerning principles of natural justice and procedural fairness). Petitioner's arguments: The petitioner argued that the impugned order was illegal because neither the show cause notices nor the personal hearing notices were served upon them. They asserted that the order was passed in violation of the principles of natural justice. Respondents' arguments: The respondents, through their counsel, conceded that they possessed no proof of service of the show cause notices and personal hearing notices on the petitioner.