TaxTMI 
TaxTMI 
2024 (6) TMI 162
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....ection in the nature of certiorari quashing the impugned Show Cause Notice issued to the petitioner u/ s 74 of the UPGST Act vide Reference No. ZD090823132533D dated 07.08.2023 issued in FORM GST DRC-01 by Respondent no.2 (Annexure No.2)." 3. It is the case of the petitioner that the company was registered under Uttar Pradesh Goods and Services Tax Act, 2017 (for short 'the Act'). An audit notice was issued to the petitioner on 05.05.2022 vide FORM GST ADT-01 by the Joint Commissioner (Tax Audit), Commercial Tax, Lucknow, requiring the petitioner to produce books of accounts and present its case regarding due discharge of tax liabilities. A survey of the premises of the petitioner was conducted by the Revenue Officials on 11.05.2022. Another notice was issued in FORM GST ADT-01 to the petitioner on 05.01.2023 on similar grounds. The petitioner claims to have complied with all the directions issued by the respondents, however, it was not given any information regarding the action taken in furtherance of audit notices dated 05.05.2022 and 05.01.2023 by the respondent authorities. As per the provisions of Section 65(4) of the Act, if the respondents failed to complete the a....
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....ed that the leading judgment of a Co-ordinate Division Bench in Bharat Mint & Allied Chemicals (supra) has been relied upon in the case of M/s Mohini Traders (supra) and M/ s Mahendra Educational Pvt. Ltd. (supra) by two Coordinate Division Benches and he has read out the judgment of the Division Bench in Bharat Mint & Allied Chemicals (supra), wherein the Division Bench has framed two questions to decide; the first related to whether opportunity of personal hearing is mandatory under Section 75(4) of the CGST/UPGST Act 2017; and second question was whether under the facts and circumstances of the case, the impugned adjudication order has been passed in breach of principle of natural justice and consequently, it deserved to be quashed in exercise of powers conferred under Article 226 of the Constitution of India. 9. The Co-ordinate Bench dealt with the notice issued to the petitioner under Section 75(4) of the Act and observed that under the column meant for the date, time and place of personal hearing, the officer has noted NA (not applicable) and then has quoted the language of Section 75(4) of the Act. To decide the controversy, it is appropriate to quote the judgement of Bha....
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....lete disregard to the statutory mandate of Section 75(4) of the Act 2017. 12. It has also been admitted in the counter affidavit that except permitting the petitioner to reply to the show cause notice, opportunity of personal hearing has not been afforded to the petitioner. Thus the legislative mandate of Section 75(4) of the Act to the authorities to afford opportunity of hearing to the assessee i.e. to follow principles of natural justice, has been completely violated by the respondents while passing the impugned order." 10. The Court thereafter observed that the stand taken by the respondents that the petitioner has alternative remedy of appeal under Section 107 of the Act cannot be accepted. Insofar as it is settled law that availability of alternative remedy, is not a complete bar to entertain a writ petition under Article 226 of the Constitution of India and has referred to exceptions that have been carved out to alternative remedy by the Hon'ble Supreme Court with regard to three cases i.e. (i) where there is complete lack of jurisdiction in the officer or authority to take the action or to pass the order impugned; or (ii) where vires of an Act, Rules, Notifi....
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....al stage, if required." 12. A coordinate Bench sitting at Lucknow in M/s Mahendra Educational Pvt. Ltd. (supra) has placed reliance upon the Division Bench Judgement in the case of M/s Bharat Mint & Allied Chemicals (supra) and has quoted the observations made in the case of M/s Mohini Traders (supra) and observed in paragraph 8 as follows:- "8. Not only such opportunity would ensure observance of rules of natural of justice but it would allow the authority to pass appropriate and reasoned order as may serve the interest of justice and allow a better appreciation to arise at the next/appeal stage, if required." 13. It has been argued on the basis of observations made by the three Division Benches of this Court that the law is settled insofar as Section 75(4) of the Act is concerned. The officer should not only issue a show cause notice, but also give personal hearing where a request has been received in writing from the person chargeable with tax or penalty or where any adverse decision is contemplated against any such person. 14. Learned counsel for the State-respondents has pointed out that Section 74 of the Act, which relates to determination of tax not paid or....
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....officer in writing of such payment. (6) The proper officer, on receipt of such information, shall not serve any notice under sub-section (1), in respect of the tax so paid or any penalty payable under the provisions of this Act or the rules made thereunder. (7) Where the proper officer is of the opinion that the amount paid under sub-section (5) falls short of the amount actually payable, he shall proceed to issue the notice as provided for in sub-section (1) in respect of such amount which falls short of the amount actually payable. (8) Where any person chargeable with tax under sub-section (1) pays the said tax along with interest payable under section 50 and a penalty equivalent to twenty-five per cent. of such tax within thirty days of issue of the notice, all proceedings in respect of the said notice shall be deemed to be concluded. (9) The proper officer shall, after considering the representation, if any, made by the person chargeable with tax, determine the amount of tax, interest and penalty due from such person and issue an order. (10) The proper officer shall issue the order under sub-section (9) within a period of five years ....
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.... read in that context and it requires that an opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty or where an adverse decision is contemplated against such person. 19. It has however been argued by the learned counsel for the petitioner that if such an interpretation is given to Section 75 of the Act and its sub clauses, it would render a situation anomalous and he has read out sub-sections (5), (6), (7), (8) and (9) of Section 75 of the Act. Section 75 of the Act in its entirety is quoted below:- "Section 75. General provisions relating to determination of tax. (1) Where the service of notice or issuance of order is stayed by an order of a court or Appellate Tribunal, the period of such stay shall be excluded in computing the period specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of section 74, as the case may be. (2) Where any Appellate Authority or Appellate Tribunal or court concludes that the notice issued under sub-section (1) of section 74 is not sustainable for the reason that the charges of fraud or any willful-misstatement or suppression of fact....
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....he decision of the Appellate Authority and that of the Appellate Tribunal or the date of decision of the Appellate Tribunal and that of the High Court or the date of the decision of the High Court and that of the Supreme Court shall be excluded in computing the period referred to in sub-section (10) of section 73 or sub-section (10) of section 74 where proceedings are initiated by way of issue of a show cause notice under the said sections. (12) Notwithstanding anything contained in section 73 or section 74, where any amount of self-assessed tax in accordance with a return furnished under section 39 remains unpaid, either wholly or partly, or any amount of interest payable on such tax remains unpaid, the same shall be recovered under the provisions of section 79. (13) Where any penalty is imposed under section 73 or section 74, no penalty for the same act or omission shall be imposed on the same person under any other provision of this Act." 20. Learned counsel for the petitioner has also argued that Section 75(4) of the Act would be rendered otiose if this Court comes to the conclusion that the argument raised by the learned counsel for the State-respondents i....
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....iving effect to the will of the judges; always for the purpose of giving effect to the will of the legislature; or in other words, to the will of the law. Therefore, where the legislature clearly declares its intent in the scheme and language of a Statute, it is the duty of the Court to give full effect to the same without scanning its wisdom or policy, and without engrafting, adding or implying anything which is not congenial to or consistent with such expressed intent of the law; if the Statute is a taxing Statute. If the legislature wilfully omits to incorporate something of an analogous law in a subsequent Statute, or even if there is casus omissus in a Statute, the language of which is otherwise plain and unambiguous, the Court is not competent to supply the omission by engrafting on it or introducing in it, under the guise of interpretation, or by implication, something that it thinks to be a general principle of justice and equity. To do so, would be entrenching upon the preserve of the legislature, the primary function of a Court of law, being jus dicere and not jus dare. 25. In Godrej and Boyce Manufacturing Company Limited Vs Deputy Commissioner of I.T., Mumbai and ano....
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....nless it is absolutely necessary to do so. Principles of interpretation do not permit Courts to do so, unless the provision as it stands is meaningless or of doubtful meaning. Courts are not entitled to read words into an Act of Parliament, unless clear reason for it is to be found within the corners of the Act itself. 29. In D.R. Venkatachalam and others, etc Vs. Deputy Transport Commissioner and others, AIR 1977 Supreme Court 842, it was observed that courts must avoid the danger of a priori determination of the meaning of a provision based on their own preconceived notions of ideological structure or scheme into which the provision to be interpreted is somewhat fitted. They are not entitled to usurp legislative function under the guise of interpretation. 30. The Supreme Court in the case of Bharat Aluminium Company vs Kaiser Aluminium Technical Services Inc., reported in 2012 (9) SCC 552, has held that the Court must proceed on the footing that the legislature intended what it has said. Even where there is a casus omissus, it is for others than the Courts to remedy the defect. it has quoted the House of Lords in Duport Steels Ltd Vs. Sirs, 1980, All ER 529 (HL) in observin....
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....dard of drafting is such that itrarely emerges". 33. In Commissioner of Customs (Import), Mumbai Versus Dilip Kumar and Company and others, 2018 (9) SCC page 1, a Constitution Bench of the Supreme Court was interpreting an exemption clause as per customs Notification 20 of 1999, relating to concessional rate of Duty pertaining to prawn feed. The concessional duty was denied by the department to the respondent, who had imported a consignment of Vitamin E 50 powder (feed grade) on the ground that the goods under import contained chemical ingredients for animal feed, and not animal feed/prawn feed. The Supreme Court observed that in the matter of interpretation of charging section of taxation Statute, this rule of interpretation is mandatory that if there are two views possible in the matter of interpretation of the charging section, the one favourable to the assessee needs to be applied. 34. The Supreme Court further observed that the principles of interpretation of statutes come in handy here. In spite of the fact that experts in the field assist in drafting Act and Rules, there are many occasions where the language used and the phrases employed in the Statute are not perfect.....
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....to the hardship and consequences that flow from such a provision can even explain the true intention of the legislation. 35. After referring to Justice GP Singh's 'Principles of Statutory Interpretation' and several English case laws and also judgements of the Supreme Court, the Constitution Bench in paragraph 34 of Commissioner of Customs (Import), Mumbai Vs. Dilip Kumar and Company and others, 2018 (9) SCC 1, has observed as under: - "In interpreting a taxing statute, equitable considerations are entirely out of place. A taxing statute cannot be interpreted on any presumption or assumption. A taxing statute has to be interpreted in the light of what is clearly expressed; it cannot imply anything which is not expressed; it cannot import provisions in the statute so as to supply any deficiency; (ii) Before taxing any person, it must be shown that he falls within the ambit of the charging section by clear words used in the section; and (iii) If the words are ambiguous and open to two interpretations, the benefit of interpretation is given to the subject and there is nothing unjust in a taxpayer escaping if the letter of the law fails to catch him on account of Legislatur....
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....t to the tax specified in the notice. Under sub-Section (9), the proper officer shall after considering the representation if any, made by the person chargeable with tax, determine the amount of tax, interest, and penalty due from such person and issue an order. Under sub-Section (10), the limitation is provided within which the proper Officer shall issue order under sub-Section (9). Under sub-Section (11), where any person is served with an order issued under sub-Section (9) and he pays the tax along with interest payable thereon under Section 50 and a penalty equivalent to 50% of such tax payable within 30 days of communication of the order, all proceedings in respect of such notice shall be deemed to be concluded. 39. It is evident from the scheme of Section 74 that initially a notice along with a statement of tax payable along with penalty has to be issued by the proper officer within the time limit as prescribed, to which a representation can be made by the assessee in case he is dissatisfied with such computation of tax and penalty. On the other hand, in case the assessee pays the amount as given in the notice along with interest payable thereon and penalty, then ....
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....l with adjudication by the proper officer after remand either by the Appellate Tribunal or the Courts, whereas sub-Sections (4) and (5), (6), (7), (9) and (10), in Section 75 deal with assessment before the matter is taken up in appeal and remanded to the proper officer for reconsideration on merit. 43. If we take recourse to internal aids to construction of the charging Section then 'Sub-heading' being an internal aid, can be validly referred to while determining the true purport of the words 'opportunity of hearing'. Sub-heading of Section 75 clearly states that it describes the 'General Provisions relating to Determining of Tax'; then most certainly Section 75 deals with all kinds of hearings for determining tax, both at the first instance and also on remand. Also sub-Section (4) is followed by sub-Section (5), which requires an officer to adjourn a hearing on the request of the person chargeable to Tax, in case sufficient cause is shown by such person after recording reasons for such adjournment in writing. Such words as are used for granting more time to the assessee and adjourning the hearing can only be interpreted to mean giving "personal" hearing. Adjournment is granted....