Ashutosh Kumar Singh vs. Union Of INDIA

Held

The Court held that the petitioner's claim of not being given a fair opportunity of hearing was not substantiated. The petitioner failed to submit any response to the initial notices under Section 61 and subsequently to the show cause notices under Section 73. The Court found that after filing a reply to a show cause notice, there is an opportunity to seek a personal hearing, which the petitioner did not avail. Since the petitioner did not appear before the authority on both occasions and did not file a reply to the show cause notice, he could not allege a denial of fair opportunity. The Court also addressed the petitioner's arguments regarding the merits of the tax demand, stating that these grounds should be raised before the Appellate Authority. The Court found no violation of the principle of natural justice and therefore, the writ petition was not maintainable on merits. Regarding the petitioner's submission about the precondition of depositing 10% for appeal, the Court noted that this is a statutory condition and the writ jurisdiction cannot be exercised to avoid such mandatory preconditions, especially for an assessee who did not respond to notices and approached the court after the limitation period for appeal expired. Consequently, the Court found no merit in the writ petition.

Facts

The petitioner, Ashutosh Kumar Singh, filed a writ petition challenging a show cause notice dated 13.08.2024 and a demand order dated 08.10.2024, both issued by Respondent No. 4 under Section 73 of the GST Act, 2017. The challenge pertains to financial years 2021-2022 and 2022-2023, with disputed amounts of Rs. 18,10,762/- and Rs. 34,44,384/- respectively. The petitioner's tax returns were scrutinized in 2024, leading to notices under Section 61 of the GST Act on 03.06.2024 due to discrepancies in TDS credit and turnover. The petitioner failed to respond to these notices. Subsequently, show cause notices under Section 73 were issued on 13.08.2024, proposing demands of Rs. 16,12,020/- and Rs. 30,19,734/-. The petitioner again did not reply. The demand orders were then passed on 08.10.2024. The petitioner claimed he was not given a fair opportunity of hearing due to illness and hospitalization from 12.09.2024 to 16.09.2024. The respondents argued that an alternate remedy of appeal exists, making the writ petition not maintainable.

Key Issues

1. Whether the petitioner was denied a fair opportunity of hearing, thereby violating principles of natural justice, in light of his non-response to notices and claim of illness, as per Section 73 of the CGST Act, 2017? 2. Whether the writ petition is maintainable given the availability of an alternate statutory remedy of appeal against the demand order? Petitioner's Arguments: The petitioner contended that he was not given a fair opportunity of hearing and could not participate in the inquiry due to illness and hospitalization during the relevant period. He relied on judgments from the Madhya Pradesh High Court in *Patanjali Ayurved Limited Vs. The State of Madhya Pradesh* and the Allahabad High Court in *Shri Sai Palace Vs. The State of Uttar Pradesh and Others*, where writ petitions were entertained for lack of personal hearing. Revenue's Arguments: The respondents argued that the petitioner has an alternate remedy of appeal to challenge the final order, and therefore, the writ petition is not maintainable. They also implicitly argued that the petitioner's failure to respond to multiple notices negates the claim of denial of opportunity.