M/S Global Corporation vs. State Of U.P. And 3 Others

Held

The Court held that while the order dated February 18, 2021, was appealable, a patent error had occurred as no adjudication notice under Section 74(1) of the UPGST Act appeared to have been issued to the petitioner before passing the order. The Court found this to be an undisputed fact. Consequently, the Court determined that relegating the petitioner to the statutory alternative remedy would serve no useful purpose at this stage. The Court set aside the order dated February 18, 2021. The operative direction was that the petitioner could treat the order dated February 18, 2021, as the final notice issued to it under Section 74(1) of the Act and submit its reply within four weeks from the date of the order. All subsequent proceedings were to be concluded strictly in accordance with law and as expeditiously as possible. The issue of jurisdiction was not expressly decided, as the matter was disposed of on procedural grounds.

Facts

The petitioner, M/s Global Corporation, filed a writ petition challenging proceedings initiated under Section 74 of the UPGST Act and a notice dated January 8, 2021, issued by respondent no. 2. The petitioner also sought to quash an order dated February 18, 2021, issued by the same respondent. The petitioner initially argued a lack of jurisdiction of respondent no. 2, denial of mandatory opportunity under Rule 142(1A) and 142(2A), and inability to respond due to the pandemic. Subsequently, the petitioner clarified that the notice dated January 8, 2021, was a preliminary notice under Section 74(5), and the respondent authority failed to issue a proper adjudication notice under Section 74(1) before passing the demand order on February 18, 2021.

Key Issues

1. Whether respondent no. 2 had the proper jurisdiction to initiate proceedings against the petitioner under the UPGST Act, considering the petitioner's contention that the Central GST Authority was the proper authority? (Question of law) 2. Whether the mandatory opportunity contemplated by Rule 142(1A) and 142(2A) of the UPGST Rules was denied to the petitioner, as the preliminary notice was not followed by a proper adjudication notice under Section 74(1) of the Act? (Question of mixed law and fact) 3. Whether the order dated February 18, 2021, passed without issuing a proper adjudication notice under Section 74(1) of the Act, is sustainable? (Question of law) Petitioner's arguments: The petitioner argued that respondent no. 2 lacked jurisdiction and that the mandatory opportunity under Rule 142 was denied. They contended that even if a preliminary notice was issued, the absence of a proper adjudication notice under Section 74(1) before passing the demand order rendered the proceedings invalid. Reliance was placed on Rule 142(1A) and 142(2A). Respondent's arguments: The judgment records that the respondents' counsel were asked to obtain written instructions on the facts presented by the petitioner. No specific arguments from the respondents are recorded in the judgment regarding the merits of the petitioner's claims.