Approaching court without allowing department to consider defence reply and afford hearing is not in accordance with law

S.Kaja Mohideen Vs Commissioner of GST & Central Excise (Madras High court)

Approaching court without allowing department to consider defence reply and afford hearing is not in accordance with law

Madras High Court held that approaching court directly against the impugned notice without allowing department to consider the defence reply and providing opportunity of hearing is not in accordance with law. Accordingly, court directed petitioner to appear for personal hearing before respondent.

Facts- Based on the alleged wrong availing of Input Tax Credit, the respondents have issued the impugned show cause notice. The petitioner has also sent a detailed reply to the impugned show cause notice on 10.02.2023, reiterating the contentions that have been raised by the petitioner in this Writ Petition. Even before a final order could be passed by the respondents, after giving due consideration to the petitioner’s reply, the petitioner has approached this Court challenging the impugned show cause notice which in the considered view of this Court is premature. However, the respondents will have to certainly give due consideration to the objections raised by the petitioner in his reply dated 10.02.2023 and only after affording a personal hearing to him, is entitled to pass a final order.

Conclusion- For the foregoing reasons, this Writ Petition is disposed of by directing the petitioner to appear for personal hearing with the respondents on 02.03.2023 at 10:30 a.m. and the respondents, after affording a personal hearing to the petitioner, after giving due consideration to the reply dated 10.02.2023 submitted by the petitioner and after adhering to the principles of natural justice, shall pass final orders on merits and in accordance with law, pursuant to the impugned show cause notice dated 08.03.2022, within a period of eight weeks from the date of the personal hearing. The petitioner is also permitted to produce Additional documents in support of their contentions to the respondents.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

This Writ Petition has been filed challenging the show cause notice dated 08.03.2022 issued under the GST Act.

2. The petitioner has challenged the aforementioned show cause notice on the following grounds:

a) The petitioner having closed down his business in the year 2013 itself, the allegations levelled in the show cause notice are arbitrary and illegal. The petitioner is not liable to pay the amount towards reversal of Input Tax Credit as well as the penalty as claimed in the show cause notice dated 08.03.2022;

b) A show cause notice can be challenged only if the same is issued without Authority under Law or has been issued without jurisdiction or has predetermined the issue. In the instant case, none of the above mentioned requirements have been satisfied.

c) Based on the alleged wrong availing of Input Tax Credit, the respondents have issued the impugned show cause notice. The petitioner has also sent a detailed reply to the impugned show cause notice on

d) As seen from the documents filed along with this Writ Petition, the petitioner has been afforded a personal hearing on 21.02.2023.

3. A show cause notice can be challenged only if the same is issued without Authority under Law or has been issued without jurisdiction or has predetermined the issue. In the instant case, none of the above mentioned requirements have been satisfied.

4. Based on the alleged wrong availing of Input Tax Credit, the respondents have issued the impugned show cause notice. The petitioner has also sent a detailed reply to the impugned show cause notice on 10.02.2023, reiterating the contentions that have been raised by the petitioner in this Writ Petition. Even before a final order could be passed by the respondents, after giving due consideration to the petitioner’s reply, the petitioner has approached this Court challenging the impugned show cause notice which in the considered view of this Court is premature. However, the respondents will have to certainly give due consideration to the objections raised by the petitioner in his reply dated 10.02.2023 and only after affording a personal hearing to him, is entitled to pass a final order.

5. As seen from the documents filed along with this Writ Petition, the petitioner has been afforded a personal hearing on 21.02.2023.

6. Learned counsel for the petitioner also submits that the petitioner shall appear for the personal hearing today (21.02.2023) and he also requests for one more personal hearing for the petitioner. No prejudice would be caused to the respondents if one more personal hearing is afforded to the petitioner. The petitioner shall appear before the respondents for another personal hearing on 02.03.2023 at 10:30 a.m. without fail.

7. For the foregoing reasons, this Writ Petition is disposed of by directing the petitioner to appear for personal hearing with the respondents on 02.03.2023 at 10:30 a.m. and the respondents, after affording a personal hearing to the petitioner, after giving due consideration to the reply dated 10.02.2023 submitted by the petitioner and after adhering to the principles of natural justice, shall pass final orders on merits and in accordance with law, pursuant to the impugned show cause notice dated 08.03.2022, within a period of eight weeks from the date of the personal hearing. The petitioner is also permitted to produce Additional documents in support of their contentions to the respondents.

8. With the aforementioned directions, this Writ Petition is disposed of. No Costs. Consequently, the connected Writ Miscellaneous Petition is closed.