2023 (10) TMI 864 - HC - GST

Court Quashes Order, Directs Respondent to Address Petitioner's Concerns Within 30 Days, Ensures Hearing Opportunity.

The HC quashed the impugned order dated 24.11.2022, passed by the 4th respondent, for violating the Court's directions. It directed the 3rd respondent to ... Quashing of order passed without jurisdiction - violation of specific judicial directions - absence of locus standi of subordinate officer to comply with express court direction - interpretation of 'Commissioner' for purposes of compliance with court direction - remand for fresh consideration with opportunity of hearing - natural justice - opportunity of hearingViolation of specific judicial directions - absence of locus standi of subordinate officer to comply with express court direction - quashing of order passed without jurisdiction - interpretation of 'Commissioner' for purposes of compliance with court direction - Impugned order dated 24.11.2022 passed by the Assistant Commissioner was in contravention of earlier direction to the Commissioner and therefore liable to be set aside. - HELD THAT: - The Court observed that its earlier order in W.P. No. 27336 of 2022 specifically directed the Commissioner of Central Tax and Customs, Hyderabad GST Commissionerate, to consider the petitioner's representations after hearing him and to decide the same within 30 days. The impugned order was, however, passed by the Assistant Commissioner. Section 2(24) of the CGST Act defines 'Commissioner' so as to include the Principal Commissioner and Commissioner of Central Tax but does not equate an Assistant Commissioner with the Commissioner. For that reason, the Assistant Commissioner was not the officer directed by this Court and entertaining and deciding the representations amounted to acting contrary to the specific direction of the Court. The respondents' reliance on internal administrative provisions and Circular No. 3/3/2017-GST could not cure non-compliance with the express designation in the Court's order. Consequently, the impugned order is held to be in clear violation of the earlier judicial direction and is quashed. The Court did not adjudicate the merits of the demand for interest; instead, it required fresh consideration by the officer designated in the original direction so that the petitioner is afforded the hearing directed by the Court. [Paras 17, 18, 19, 20, 21]Impugned order dated 24.11.2022 passed by the Assistant Commissioner is set aside for being contrary to the earlier direction to the Commissioner; the matter is remitted to the 3rd respondent to consider the representations after giving an opportunity of hearing within 30 days.Remand for fresh consideration with opportunity of hearing - natural justice - opportunity of hearing - Whether the petitioner's representations should be reconsidered by the appropriate officer in accordance with the Court's earlier direction. - HELD THAT: - The Court directed that, in view of the quashing of the order passed by the Assistant Commissioner, the 3rd respondent (Commissioner of Central Tax and Customs, Hyderabad GST Commissionerate) shall consider the representations dated 18.04.2022 and 28.04.2022 and pass appropriate orders after affording an opportunity of hearing to the petitioner within 30 days from receipt of this order. The Court thereby remitted the dispute for fresh consideration by the officer expressly named in the original writ order, preserving the petitioner's right to be heard and without expressing any opinion on the correctness of the demand for interest. [Paras 21, 22]The 3rd respondent is directed to consider the petitioner's representations and pass orders after hearing the petitioner within 30 days; the writ petition is allowed and there shall be no order as to costs.Final Conclusion: The writ petition is allowed: the order dated 24.11.2022 passed by the Assistant Commissioner is quashed for being contrary to this Court's earlier direction to the Commissioner; the matter is remitted to the Commissioner to decide the petitioner's representations after affording an opportunity of hearing within 30 days. Issues Involved:1. Legality of the suo moto migration of the petitioner's GST registration.2. Delay in filing GSTR-3B returns and the resultant interest demand.3. Jurisdiction and authority of the officer passing the impugned order.Summary:Issue 1: Legality of Suo Moto MigrationThe petitioner, a sole proprietor of M/s. RC Reddy IAS Study Circle, contended that the 5th respondent office illegally effected suo moto migration to the GST system by using their own mobile number and email ID, violating Rule 24 of CGST Rules, 2017. This unauthorized action prevented the petitioner from filing monthly returns due to the inability to receive the One Time Password (OTP) required for login.Issue 2: Delay in Filing GSTR-3B Returns and Interest DemandDue to the incorrect mobile number and email ID, the petitioner faced delays in filing returns from September 2017 to January 2019, despite making several representations and visits to the respondent department. The petitioner continued to make online payments towards CGST and SGST liabilities, which were reflected in their cash ledger. However, the 5th respondent demanded interest for the delay, issuing a garnishee order to the petitioner's bank for Rs. 30,07,927/- under Section 79(1)(c) of the CGST/SGST Act, 2017.Issue 3: Jurisdiction and Authority of the Officer Passing the OrderThe petitioner challenged the impugned order dated 24.11.2022, arguing that it was passed by the 4th respondent, the Assistant Commissioner, who lacked the legal authority as per the Court's direction in W.P. No. 27336 of 2022, which specifically instructed the 3rd respondent, Commissioner of Central Tax and Customs, to consider the representations. The Court found that the Assistant Commissioner is not a 'Commissioner' as defined under Section 2(24) of CGST Act, 2017, and thus, the impugned order was contrary to the Court's specific directions.Conclusion:The High Court set aside/quashed the impugned order dated 24.11.2022 passed by the 4th respondent for being in violation of the Court's directions. The Court directed the 3rd respondent to consider the petitioner's representations and pass appropriate orders within 30 days, duly affording an opportunity of hearing to the petitioner. The writ petition was allowed, with no order as to costs.