2022 (6) TMI 134 - HC - GST

GST Order Under Section 74 Upheld as Show Cause Notice Provided Adequate Details and Alternative Remedy Available

HC dismissed the writ petition challenging a GST order under Section 74, finding no violation of natural justice principles. The court noted that the ... Maintainability of petition - availability of alternative remedy of appeal - Section 107 of the CGST/ SGST Act, 2017 - Evasion of turnover and tax - HELD THAT:- Perusal of the impugned order shows that the Proper Officer has issued detailed show cause notice based on documentary evidences indicating evasion of turnover and tax. In the impugned order, the Proper Officer under the CGST/ SGST Act, 2017 has recorded a finding that 'pursuant to the notice, assessee appeared and mainly pressed point Nos.5, 7, 9 and 10 of the show cause notice.' Thus, as per the impugned order, it appears that the petitioner has pressed his reply before the Proper Officer only on point Nos.5, 7, 9 and 10 of the show cause notice and his submissions have been noted by the Proper Officer in the impugned order and, thereafter giving reasons, contention of the petitioner has been rejected. Since the petitioner has an alternative remedy of appeal in which questions of fact and law may be raised and, therefore, the writ petition deserves to be dismissed on the ground of alternative remedy of appeal under Section 107 of the CGST/ SGST Act, 2017. It is made clear that in the event the petitioner files an appeal before the appellate authority complying with the statutory provisions, then the appeal shall be heard by the appellate authority without being influenced by any of the observations made in the body of this order. Petition dismissed. Issues:1. Breach of principles of natural justice in passing the impugned order under Section 74 of the CGST/ SGST Act, 2017.2. Proper consideration of the petitioner's submissions and alternative remedy of appeal under Section 107 of the CGST/ SGST Act, 2017.Analysis:1. The petitioner sought relief through a writ petition to quash the impugned order dated 29.03.2022 passed by the respondent no. 2 for the F.Y. 2017-2018 Tax Period Aug 2017-Feb 2018. The petitioner's counsel argued that the order was passed in violation of natural justice as no opportunity of hearing was provided. Citing judgments such as Ravi Yashwant Bhoir Vs. District Collector, Oryx Fisheries Pvt. Ltd. vs. Union of India, Ayaaubkhan Noorkhan Pathan vs. State of Maharashtra, and Magadh Sugar & Energy Ltd. vs. State of Bihar, the petitioner contended that the lack of a hearing opportunity was a breach of principles of natural justice. On the other hand, the standing counsel supported the impugned order.2. The High Court analyzed the impugned order and noted that the Proper Officer had issued a detailed show cause notice based on documentary evidence indicating evasion of turnover and tax. The order mentioned that the petitioner had mainly pressed certain points of the show cause notice during the proceedings. The court observed that the petitioner did not raise objections against all points in the notice, and only specific points were addressed. The judgment highlighted that the petitioner had the option to appeal under Section 107 of the CGST/ SGST Act, 2017, where factual and legal issues could be raised. Therefore, the court dismissed the writ petition, emphasizing the availability of an alternative remedy through the appellate authority. The court clarified that any observations made in the order should not influence the appellate authority's decision if the petitioner chooses to file an appeal and comply with statutory provisions.This detailed analysis of the judgment addresses the issues of breach of natural justice and the proper consideration of the petitioner's submissions, along with the availability of an alternative remedy through the appellate process under the relevant provisions of the CGST/ SGST Act, 2017.