M/S Bajaj Enterprises (A Partnership Firm) vs. State Of Chhattisgarh

Facts

The petitioner, M/s Bajaj Enterprises, filed a writ petition before the High Court of Chhattisgarh at Bilaspur challenging an undated order of Demand of Tax & Penalty passed by the Assistant Commissioner, Chhattisgarh State Tax. The petitioner contended that the impugned order was passed under the repealed provision of Section 129(1)(a) of the Central Goods and Services Tax Act, 2017, which was amended effective January 1, 2022. The State/respondents acknowledged that the order was passed on October 13, 2022, under the old provision and sought liberty to issue a fresh show cause notice and pass a new order.

Held

The Court held that the impugned undated order (Annexure -P/1) suffers from illegality from its inception because it was passed under the repealed provision of Section 129(1)(a) of the CGST Act. The Court noted that the notice was also issued under the repealed provision. Consequently, without delving into the merits of the case, the petition was allowed. The Court set aside and quashed the impugned order, granting liberty to the respondents to issue a fresh show cause notice and pass an appropriate order in accordance with the law, ensuring the petitioner was given due opportunity of hearing. The bank guarantee submitted by the petitioner was directed to continue until the final order. The Court further directed that the final adjudication be completed within 90 days from the receipt of the order.

Key Issues

1. Whether the impugned undated order of Demand of Tax & Penalty, passed by the Assistant Commissioner (Respondent No. 2) under Section 129(1)(a) of the CGST Act, is illegal due to being based on a repealed provision. Petitioner's Contention: The petitioner argued that the impugned order is illegal and void ab initio because it was passed under Section 129(1)(a) of the CGST Act, a provision that had been repealed and re-enacted with effect from January 1, 2022. The fact that the order is undated further compounds its illegality. Revenue/State's Contention: The State/respondents conceded that the impugned order was passed on October 13, 2022, under the old provision of Section 129(1)(a) of the CGST Act. They prayed for the quashing of the impugned order and sought permission to issue a fresh show cause notice and pass a new order.