Vikas Kumar Omar Vs Principal Commissioner CGST Commissionerate Rohtak And Another (Panjab Haryana High Court)
The Punjab and Haryana High Court considered a writ petition challenging an order dated 04.12.2025 insofar as it imposed a penalty on the petitioner under Section 122 of the Central Goods and Services Tax Act, 2017. The petitioner contended that no show cause notice (SCN) had been issued before the initiation of penalty proceedings and, therefore, the penalty order violated the principles of natural justice.
During the hearing, counsel for the revenue did not dispute that no SCN had been issued to the petitioner in relation to the proceedings under Section 122 of the Act.
The Court noted that Section 122 provides for penalty for certain offences under the CGST Act, while Section 126(3) lays down the general disciplines relating to penalty and expressly provides that no penalty shall be imposed on any person without giving him an opportunity of being heard.
The Court found that, in the present case, the respondents had imposed the penalty without issuing any show cause notice to the petitioner. It held that this constituted apparent non-compliance with Section 126(3) of the CGST Act, 2017. According to the Court, such non-compliance resulted in a breach of the principles of natural justice.
On this ground alone, the Court held that the penalty imposed on the petitioner under Section 122 could not be sustained insofar as it related to the petitioner.
Accordingly, the writ petition was disposed of with these observations. The Court also directed that all pending miscellaneous applications, if any, would stand disposed of accordingly.
FULL TEXT OF THE JUDGMENT/ORDER OF PUNJAB AND HARYANA HIGH COURT
1. This petition is directed against the impugned order dated 04.12.2025 contained in Annexure P-1, insofar as a penalty has been imposed upon the petitioner under Section 122 of the Central Goods and Services Tax Act, 2017 (for short, the ‘Act of 2017’).
2. A short ground on which the order is assailed is that no Show Cause Notice (SCN) was actually issued calling upon the petitioner to explain as to why a penalty should not be imposed upon him, and therefore, the order passed by the authority imposing the penalty clearly violates the principles of natural justice.
3. Learned counsel appearing for the revenue does not dispute the fact that no SCN in respect of the initiation of proceedings under Section 122 of the Act of 2017 against the petitioner had been issued.
4. Section 122 of the Act of 2017 provides for ‘Penalty for certain offences’. The general disciplines relating to penalty have been specified in Section 126(3) of the Act of 2017, which provides as under:-
“126 General disciplines related to penalty:-
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(3) No penalty shall be imposed on any person without giving him an opportunity of being heard.
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5. Since, in the present case, no SCN had been issued to the petitioner before imposing the penalty, there is an apparent noncompliance with the provisions contained in Section 126(3) of the Act of 2017. This non-compliance has resulted in a breach of the principles of natural justice by the respondents. On this ground alone, the imposition of the penalty, insofar as it relates to the present petitioner, cannot be sustained.
6. With these observations, the instant writ petition is disposed of.
7. All pending miscellaneous application(s), if any, shall also stand disposed of accordingly.
