Rpm Engineering Works And Contracts vs. The Assistant Commissioner Of GST And Central Excise

Held

The Court held that discretion could be exercised in favour of the petitioner, considering the overwhelming records indicating their hospitalization due to an accident on 19.01.2017. The Court quashed the impugned Order-in-Original No.322/2022-ST dated 06.12.2022. As a condition for the 1st respondent to reconsider the case, the petitioner was directed to deposit 25% of the disputed tax to the credit of the 1st respondent within 30 days of receiving the order. The impugned order was to be treated as an addendum to the Show Cause Notice. The 1st respondent was directed to pass orders on merits expeditiously, preferably within three months thereafter. The attachment of the bank account would stand lifted subject to the deposit or recovery of the 25% amount. The Court did not expressly leave any issue undecided.

Facts

The petitioner, RPM Engineering Works & Contracts, filed a writ petition challenging an Order-in-Original No.322/2022-ST dated 06.12.2022, passed by the Assistant Commissioner of GST and Central Excise (1st respondent), and a consequential recovery notice dated 11.06.2024. The petitioner's bank account with Union Bank of India (2nd respondent) was attached. The petitioner contended that due to an accident on 19.01.2017, they were in a coma and subsequently unaware of the show cause notice and the impugned order. They only became aware upon receiving the recovery notice. The petitioner sought an opportunity to present their case on merits. The 1st respondent argued that the writ petition was time-barred due to laches and the appellate remedy was also time-barred.

Key Issues

1. Whether the Writ Petition is maintainable on grounds of delay and laches, considering the impugned order was passed on 06.12.2022 and the recovery notice was issued on 11.06.2024, thereby making the writ petition filed on 04.07.2024 potentially time-barred under Article 226 of the Constitution of India? 2. Whether the petitioner should be granted an opportunity to present their case on merits, despite the apparent delay, given the circumstances of their hospitalization and subsequent unawareness of the proceedings? Petitioner's Arguments: The petitioner argued that they were incapacitated due to an accident and coma from 19.01.2017, leading to their unawareness of the show cause notice and the impugned order. They relied on a coordinate bench's decision in W.P.(MD)No.9988 of 2024 (Alagar vs. The Assistant Commissioner of GST and Central Excise, Trichy) for similar circumstances. Revenue's Arguments: The 1st respondent argued that the Writ Petition was hopelessly time-barred and liable for dismissal due to laches, citing the Supreme Court's decision in Assistant Commissioner (CT) LTU, Kakinada and others vs. Glaxo Smith Kline Consumer Health Care Limited. They also contended that the appellate remedy under Section 107 of the respective GST Enactments was time-barred, referencing Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others.