Raj Kumar Borthakur Vs Joint Commissioner of Revenue (Calcutta High Court)
Summary : The Calcutta High Court considered a writ petition challenging an order dated 28 December 2023 passed under Section 73 of the WBGST/CGST Act for the tax period from April 2017 to March 2018. The petitioner submitted that the show cause cum demand notice dated 29 September 2023 was restricted to Rs.1,13,55,828/-, whereas the determination enhanced the demand to Rs.2,25,47,046/-. This was challenged as contrary to Section 75(7). Although an alternative remedy was available, the period for filing an appeal had expired and the Court found the explanation insufficient. Nevertheless, considering the peculiar facts and the petitioner’s undertaking to deposit 10 per cent of the disputed tax, the Court took up the writ petition for consideration.
The Court recorded that the impugned order determined tax of Rs.1,03,23,480/-, interest of Rs.1,11,91,218/- and penalty of Rs.10,32,348/-, aggregating to Rs.2,25,47,046/-. It observed that the total tax, interest and penalty demanded could not exceed the amount specified in the show cause cum demand notice, and that no demand could be confirmed on grounds other than those specified in that notice. The Court directed that the order dated 28 December 2023 be treated as a show cause notice, allowing the petitioner eight weeks from the date of the Court’s order to respond. The proceedings were remanded to the proper officer, who was permitted to issue a supplementary show cause within four weeks and directed to decide the proceedings in accordance with law after giving the petitioner an opportunity of hearing.
The impugned order was set aside subject to the petitioner depositing Rs.10,32,342/-, stated in the order as equivalent to 10 per cent of the disputed tax, through Form GST DRC–03 within two weeks. The Court expressly made the relief conditional upon compliance with this deposit direction. If the petitioner failed to comply, the benefit of the order would cease and the writ petition would stand automatically dismissed without further reference to the Court, leaving the respondents at liberty to enforce the order in accordance with law. The writ petition was accordingly disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
2. The present writ petition has been filed challenging the order dated 28th December 2023 passed under Section 73 of the WBGST /CGST Act, 2107 (hereinafter referred to as the said Act) in respect of the tax period from April 2017 to March 20-18.
3. Mr. Lakhotia, learned advocate appearing for the petitioner submits that though the show cause cum demand notice dated 29th September 2023 was restricted to Rs.1,13,55,828/-, the proper office while making the determination had enhanced the same to Rs.2,25,47,046/-. According to him, the aforesaid is in violation of the provisions of Section 75(7) of the said Act.
3. Mr. Lakhotia, learned advocate appearing for the petitioner submits that though the show cause cum demand notice dated 29th September 2023 was restricted to Rs.1,13,55,828/-, the proper office while making the determination had enhanced the same to Rs.2,25,47,046/-. According to him, the aforesaid is in violation of the provisions of Section 75(7) of the said Act.
4. Having heard the learned advocates appearing for the respective parties, I find that the petitioner has an alternative remedy, however, time to file the appeal has expired long back. The explanation provided is also not sufficient. However, in the peculiar facts, and on the basis of the petitioner’s undertaking, to pay 10 per cent of the tax in dispute, in the form of an email filed in Court by Mr. Lakhotia which is taken on record, the writ petition is taken up for consideration.
5. Since this Court finds that in the instant case an order has been passed determining a sum of Rs.1,03,23,480/- + 1,11,91,218/- + 10,32,348 aggregating to Rs. 2,25,47,046/- as tax, interest and penalty respectively and since, the total amount of tax, interest and penalty demanded in the order cannot be in excess of the amount specified in the show cause cum demand notice and no demand can be confirmed on the ground other than the grounds specified in the notice to show cause, in my view the above order dated 28th December 2023 should be treated as a show cause notice for the petitioner to respond to the same within a period of eight weeks from date. The proceeding is accordingly remanded to the proper officer.
6. The proper officer shall also be at liberty to provide for a supplementary show cause, provided the same is filed within a period of four weeks from date. Accordingly, the proper officer is directed to hear out and dispose of the proceedings in accordance with law after giving an opportunity of hearing to the petitioner.
7. As a sequel thereto, the order dated 28th December 2023 is set aside on the expressed undertaking as recorded above that the petitioner shall deposit by way of form GST DRC – 03, a sum equivalent to 10 per cent of the tax in dispute being Rs.10,32,342/- with the respondents within two weeks from date.
8. It is made clear that if the above direction for deposit is not complied with by the petitioner, 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 and in such event, the respondents shall be at liberty to enforce this order in accordance with law.
9. The writ petition is accordingly disposed of.
10. All parties shall act on the basis of server copy of this order duly downloaded from this Court’s official website.
