M/S Vibrations And Ors. vs. Assistant Commissioner Of Revenue, State Tax, Chandni Chawk And Princep Street Charge And Ors.

Facts

The petitioners, M/s. Vibrations & Ors., challenged an adjudication order dated 10.07.2023 passed by the Assistant Commissioner of Revenue, State Tax, and an appellate order dated 11.12.2024 passed by the appellate authority. The adjudication order stemmed from a show cause notice dated 05.04.2023 demanding tax, interest, and penalty. The petitioners contended that the show cause notice was uploaded only on the GST portal under 'Additional Notice and Orders' without any separate intimation, preventing them from responding. They learned of the adjudication order only after a change in their accountant. Their subsequent appeal was dismissed by the appellate authority solely on grounds of limitation, without considering the merits. The petitioners argued this violated principles of natural justice and statutory procedure.

Held

The Court held that the petitioner had made out a prima facie case. It observed that the show cause notice being uploaded only under the 'Additional Notice and Orders' tab without separate intimation to the petitioner constituted a violation of natural justice, as it prevented the petitioner from replying to the notice. Since the petitioner's appeal was dismissed by the appellate authority solely on the ground of limitation and not on merits, the Court found interference warranted in the ends of justice due to the peculiar facts of the case. The Court quashed and set aside the appellate order dated 11.12.2024, the adjudication order dated 10.07.2023, and the show cause notice dated 05.04.2023. Respondent No. 1 was directed to issue a fresh show cause notice within two weeks, with the petitioner to file a detailed reply within two weeks thereafter. Respondent No. 1 was further directed to revisit the issue, afford an opportunity of hearing to the petitioner, and pass a fresh reasoned order in accordance with law within 12 weeks, with the decision to be communicated within a week thereafter.

Key Issues

1. Whether the appellate order dated 11.12.2024, which dismissed the petitioner's appeal on the ground of limitation, is legal and valid, considering the petitioner's contention that they were not properly intimated about the show cause notice dated 05.04.2023, thereby violating principles of natural justice and the procedure prescribed under the WBGST Act and CGST Act? Petitioner's arguments: The petitioner argued that the show cause notice was uploaded only on the GST portal under 'Additional Notice and Orders' and no separate intimation was provided. This lack of proper intimation prevented them from responding to the notice, leading to an ex-parte adjudication order. Consequently, their appeal was dismissed on limitation without considering the merits, which they claimed was contrary to law and natural justice. They relied on the fact that they only became aware of the adjudication order upon a change of accountant. Revenue's arguments: The State respondents opposed the writ petition, submitting that the petitioner had been granted ample opportunities to defend their case and that the appeal was therefore rightly dismissed on limitation.