A.Merchy Clara vs. The Commissioner Of GST And Central Excise (Appeals)

Facts

The petitioner, A. Merchy Clara, is the legal heir of the proprietor of M/s. Knight Security Services, the late Mr. Anthuvan Maria Joseph. The petitioner is challenging an Order-In-Original dated 28.02.2022, passed by the Deputy/Assistant Commissioner of GST and Central Excise, Trichy -1 Division, under Section 73(1) of the Finance Act 1994, for the period April 2015 to June 2017. An appeal was filed against this order, and the Commissioner of GST and Central Excise (Appeals) rejected it on 31.07.2026, solely on the grounds of limitation. The proprietor passed away on 30.05.2025, prior to the appellate order. The petitioner states that a pre-deposit of 7.5% was made at the time of filing the appeal and that the original order was passed without hearing the proprietor.

Held

The Court held that the original order was clearly issued without hearing the proprietor of M/s. Knight Security Services. It also noted that the appellate order rejected the appeal solely on the ground of limitation. Considering these aspects, the Court decided to set aside the impugned original order and remand the matter to the original authority for reconsideration. This decision is subject to the condition that the petitioner remits an additional sum of Rs. 5,00,000/- within 30 days from the date of receipt of a copy of the order. The original authority is directed to provide a reasonable opportunity to the petitioner and issue a fresh order within 4 months from the date of remittance of the additional sum. The ratio of this decision is that procedural fairness, including the right to be heard, is paramount, and where such a right is denied, and an appeal is rejected on limitation without considering the merits, a remand with a condition of further deposit may be granted. The Court expressly left undecided the merits of the original assessment.

Key Issues

1. Whether the Order-In-Original dated 28.02.2022, passed by the Deputy/Assistant Commissioner of GST and Central Excise, Trichy -1 Division, is liable to be set aside on the ground that it was passed without providing a hearing to the proprietor of M/s. Knight Security Services, as contended by the petitioner. 2. Whether the appellate order dated 31.07.2026, passed by the Commissioner of GST and Central Excise (Appeals), which rejected the appeal solely on the ground of limitation, is sustainable, given the circumstances, including the death of the proprietor and the alleged lack of hearing in the original assessment. Petitioner's Arguments: The petitioner argued that the original order was passed without hearing the proprietor. On instructions, the petitioner agreed to remit an additional sum of Rs. 5,00,000/- as a condition for remand. Revenue's Arguments: The Standing Counsel for the respondents submitted that the petitioner approached the High Court belatedly concerning an order issued in 2022.