M/S Kesarwani Enterprises vs. Commercial Tax Officer And Another

Facts

The petitioner, M/s Kesarwani Enterprises, had its GST registration under the UPGST Act, 2017 cancelled on January 2, 2021, effective from the same date. The revenue has not contended that this registration was ever revived or that the petitioner sought its revival. Consequently, the petitioner argues it was not obligated to check the GST portal for show cause notices issued for the period April 2018 - March 2019, which preceded an adjudication order dated April 3, 2024. The revenue has also not asserted that any physical or offline notice was served on the petitioner before the impugned order was passed. Given these circumstances, the Court found no purpose in keeping the petition pending or relegating the petitioner to an alternative remedy.

Held

The Court held that the adjudication order dated April 3, 2024, passed by the Commercial Tax Officer, was unsustainable due to a violation of the principles of natural justice. The Court reasoned that the petitioner's GST registration was cancelled effective January 2, 2021, and there was no assertion by the revenue that the registration was revived or that the petitioner sought revival. Therefore, the petitioner was not obligated to visit the GST portal to receive show cause notices issued for the period April 2018 - March 2019 via e-mode. Furthermore, the revenue did not claim to have issued any physical or offline notice to the petitioner before passing the impugned order. The Court concluded that the essential requirement of natural justice had not been fulfilled. Consequently, the Court set aside the order dated April 3, 2024. The petitioner was granted liberty to submit its reply to the show cause notice within four weeks from the date of the order. Upon compliance, the revenue was directed to pass a fresh order after affording the petitioner an opportunity of personal hearing, as expeditiously as possible, preferably within three months.

Key Issues

1. Whether the adjudication order dated April 3, 2024, passed by the Commercial Tax Officer, is vitiated due to a violation of the principles of natural justice, specifically the right to a fair hearing, in light of the petitioner's cancelled GST registration? The petitioner argued that since its GST registration was cancelled effective January 2, 2021, it was not obligated to check the GST portal for any e-mode notices issued for the period April 2018 - March 2019. The petitioner further contended that no physical or offline notice was served upon it prior to the passing of the adjudication order. The petitioner relied on the principle that adherence to the rules of natural justice is a prerequisite for any valid order. The respondent revenue did not dispute the cancellation of the petitioner's registration or the lack of physical notice. Their contention, implied by the passing of the order, was that notices issued electronically through the GST portal were sufficient. However, the judgment does not record any specific arguments or reliance on provisions by the revenue regarding the validity of e-mode notices in the context of a cancelled registration.