M/S Sanrachna Steel Design PVT LTD vs. Joint Commissioner Of Commercial Taxes

Facts

The petitioner, M/s Sanrachna Steel Design Pvt Ltd, filed a writ petition challenging an adjudication order dated 30.07.2024 and an appellate order dated 23.04.2026. These proceedings pertained to the tax period April 2019 to March 2020. The petitioner's GST registration was cancelled on 22.09.2022. Subsequently, based on an audit report, a show cause notice was issued on 23.05.2024, leading to an adjudication order passed ex-parte. The petitioner's appeal against this order was dismissed by the Joint Commissioner of Commercial Taxes (Appeals) on the grounds of limitation. The petitioner contended that they were unaware of the proceedings due to the cancellation of their GST registration.

Held

The Court held that a distinction between the current case and the previously decided writ petition (W.P. No.21619/2026) could not be well-founded. The Court found bonafides in the petitioner's assertion that the portal was not verified due to the cancellation of GST registration and closure of business. If for the same reason, the official email ID was also not verified, then the petitioner should be given another opportunity. The Court reasoned that the petitioner's lack of knowledge was a valid ground for reconsideration, especially when the GST registration was cancelled and business activities ceased, leading to the non-monitoring of official communications. Therefore, the petitioner was granted an opportunity to file a response to the show cause notice.

Key Issues

1. Whether the dismissal of the petitioner's appeal on the grounds of limitation, despite the cancellation of their GST registration and closure of business activities, is justifiable, considering the petitioner's assertion of bonafide lack of knowledge of the proceedings? The petitioner argued that they did not have bonafide knowledge of the commencement of proceedings because their GST registration was cancelled prior to the issuance of the show cause notice. They relied on a previous order of the High Court in W.P. No.21619/2026, where similar circumstances led to the restoration of proceedings. The petitioner emphasized that the official email ID, which was the registered email ID, was not being monitored due to the closure of business. The respondents argued that in this case, the notice and order were not only uploaded on the portal but also sent to the petitioner's registered email ID, which should be considered. They sought to distinguish this case from the one cited by the petitioner.