Case Law Details
Sanat Kumar Hazra & Anr. Vs Assistant Commissioner (Calcutta High Court)
The Calcutta High Court considered a writ petition challenging a show cause notice dated 29 April 2024 and an adjudication order dated 30 December 2024 passed under Section 74 of the West Bengal Goods and Services Tax Act, 2017 and the Central Goods and Services Tax Act, 2017 for the tax period from July 2017 to December 2017.
The petitioners, partners of M/s Reliance Engineering Works, submitted that their firm was a registered taxpayer. They explained that petitioner no. 1 had been suffering from severe diabetes since 2021 and that his daughter, who had been suffering from bronchial asthma since 2011, was admitted to hospital on 10 August 2023 and passed away on 12 August 2023 at the age of 25. According to the petitioners, these circumstances caused petitioner no. 1, the key managerial person, to lose focus on the business.
The petitioners stated that a show cause notice under Section 74 was issued in Form DRC-01 during this period. Owing to the personal circumstances faced by petitioner no. 1, they could not file a reply to the notice, resulting in an ex parte adjudication order. They contended that they should be afforded an opportunity to contest the proceedings.
The petitioners further submitted that the impugned order had been uploaded on the GST portal under the tab “view additional notices and orders”. According to them, they failed to notice the order on the portal and were therefore unable to take timely steps or file a statutory appeal. Consequently, they approached the High Court by way of the present writ petition.
During the hearing, the petitioners produced a photocopy of the firm’s electronic cash ledger for the period from 1 May 2026 to 13 June 2026 and submitted that an amount of ₹26,674 had been recovered from the firm’s electronic cash ledger on 26 May 2026. They requested that this recovery be taken into account while granting them an opportunity to place their defence before the adjudicating authority.
After hearing the parties and considering the peculiar facts of the case, the High Court observed that the petitioners may have failed to notice the adjudication order because it had been uploaded under the “view additional notices and orders” tab on the GST portal. Taking into account the circumstances placed before it, the Court held that the petitioners should be granted an opportunity of hearing.
Accordingly, the Court directed that the petitioners be granted an opportunity to contest the proceedings subject to payment of ₹1,00,000 towards the disputed tax amount, without prejudice to their rights, after giving credit for any amount already recovered pursuant to the impugned order. Upon compliance with this condition, the Court set aside the adjudication order dated 30 December 2024.
The Court further directed that if the required deposit is made within four weeks, the adjudicating officer shall permit the petitioners to file their reply to the show cause notice within ten days thereafter. It was also clarified that if the petitioners fail either to make the directed payment or to respond to the show cause notice, they would not be entitled to the benefit of the order and the writ petition would stand automatically dismissed without any further reference to the Court.
The writ petition was accordingly disposed of with the above directions and observations.
Petitioner was represented by: Ms. Rita Mukherjee, Mr. Abhijat Das, Ms. Aratrika Roy, Mr. Anirban Chatterjee
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
1. Affidavit of service filed in Court today is retained with the record.
2. Challenging the show cause notice dated 29th April 2024 and order passed under Section 74 of the WBGST /CGST Act, 2017 (hereinafter referred to as the “said Act”) on 30th December 2024 for the tax period from July 2017 to December 2017, the instant writ petition has been filed.
3. The petitioners claim to be partners of an unregistered partnership firm run under the name and style of M/s Reliance Engineering Works.
4. According to the petitioners, the petitioners’ firm is a registered tax payer and has been issued appropriate registration certificate. The petitioners claim that the petitioner no. 1 has been suffering from high diabetes since the year 2021 and is under medication. The petitioners also state that as unfortunate as it may seem, the daughter of the petitioner no. 1 who was suffering from bronchial asthma since the year 2011 was admitted to hospital sometimes on 10th August 2023 in a critical condition, and while in such hospital, she expired on 12th August 2023, at the tender age of 25. The petitioner no. 1 has since been suffering a lot.
5. In the interregnum, the above show cause was issued under the provisions of Section 74 of the said Act in Form DRC – 01. In the peculiar facts as noted hereinabove, the petitioner no. 1 who was the key managerial person lost sight of his business and could not show cause following which an ex parte adjudication order was passed. The petitioners would submit that the petitioners should be given an opportunity to contest the cause.
6. It is also the petitioners’ case that the order impugned was uploaded on the portal under the tab “view additional notices and orders”. As such the petitioners had missed the same and could not take appropriate steps and or prefer any appeal therefrom in time The writ petition has been subsequently filed.
7. Mukherjee, learned advocate appearing for the petitioners has placed before this Court a photocopy of the petitioners’ firm’s electronic cash ledger for the period from 1st May 2026 to 13th June 2026 and submits that on 26th May 2026, an amount of Rs.26,674/- has been recovered from the petitioners’ firm’s electronic cash ledger. In the facts as aforesaid, she submits that the petitioners should be given an opportunity of hearing to place this defence before the adjudicating authority.
8. Ms. Mukherjee, learned advocate led by Ms. Agarwal, learned Senior Advocate appears on behalf of the State.
9. Having heard the learned advocates appearing for the respective parties and noting the peculiar facts and also considering the fact that the petitioners may have missed the order on the portal by reasons of the order being uploaded under the tab “view additional notices and orders”, I am of the view that an opportunity of hearing should be given to the petitioners subject to, however, the petitioners making payment of a total sum of Rs.1,00,000/- towards the amount of tax in dispute without prejudice to their rights, after giving credit to the amount, if any already recovered from the petitioners, pertaining to the above order. As a sequel thereto, the order dated 30th December 2024 stands set aside.
10. In the event, the aforesaid deposit is made within a period of 4 weeks therefrom, the adjudicating officer shall permit the petitioners to respond to the show cause within 10 days from date. It is also made clear that in the event the petitioners do not respond to the show cause notice or does not make payment of the amount as directed, the petitioner shall not be entitled to the benefit of this order and the writ petition shall stand automatically dismissed without further reference to this Court.
11. With the above directions and observation, the writ petition is disposed of.
All parties shall act on the basis of the server copy of this order duly downloaded from this Court’s official website.
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