Suresh Kumar Mulwani Proprietor Of Vijay Pharma vs. State Of Chhattisgarh

Held

The Court, considering the petitioner's submission that he was ready to deposit the assessed tax liability of Rs. 8,22,788/-, found a case for interference under Article 226 of the Constitution to do complete justice. The Court granted the petitioner an opportunity to file a statutory appeal against the order dated 19.02.2025 before the appellate authority within one month from the receipt of the order's copy. The Court directed the appellate authority to decide the appeal on its merits without insisting on the delay, having condoned it on the condition of depositing the tax liability. The petitioner was granted liberty to raise all defenses, including the ex parte nature of the order, before the appellate authority, which would decide the same in accordance with the law. The issue of the rectification application's rejection was implicitly addressed by allowing a statutory appeal.

Facts

The petitioner, Suresh Kumar Mulwani, proprietor of Vijay Pharma, filed a writ petition challenging an order dated 19.02.2025 passed by the Assistant Commissioner, State Tax, Raipur Circle-4. This order assessed a tax liability of Rs. 14,61,912/-, including interest and penalty, for the financial year 2020-21. The petitioner also challenged the rejection of his rectification application dated 16.03.2026, which occurred on 20.04.2026. The petitioner contended that the assessment order was passed ex parte without granting an adequate opportunity of hearing. The department had noticed discrepancies during a return scrutiny and issued notices, to which the petitioner allegedly failed to respond. The petitioner claimed to have learned of the order on 16.02.2026, prompting the rectification application.

Key Issues

1. Whether the impugned order dated 19.02.2025, assessing the tax liability, interest, and penalty, was passed in violation of the principles of natural justice due to the alleged lack of a proper opportunity of hearing for the petitioner, as contemplated under Section 73 of the GST Act, 2017? 2. Whether the petitioner's rectification application was wrongly rejected, and if so, what is the consequence? Petitioner's Arguments: The petitioner argued that the assessment order was passed ex parte without granting a proper opportunity of personal hearing, thus violating the principles of natural justice and fair play. They relied on the principle that an opportunity of hearing is a fundamental right before any adverse order is passed. Revenue's Arguments: The State counsel contended that the department had provided sufficient opportunities to the petitioner, but the petitioner failed to submit a reply. Therefore, the petitioner could not complain about a violation of natural justice, and the order did not warrant interference. They also argued that statutory limitation periods had expired, precluding further consideration even if the tax liability was deposited.