Anjani Kumar Sinha Vs Union of India (Patna High Court)
Summary: Patna High Court set aside an ex parte GST assessment order dated 11 December 2023 after finding that the Department failed to establish service of the show cause notice upon the petitioner. The dispute centred on whether the show cause notice dated 20 March 2023 had actually been served. The petitioner denied receiving either the notice or the speed-post communication, while the Department relied upon the GST portal and copies of its dispatch register to contend that the notice had also been sent by speed post. The Court held that mere dispatch of the show cause notice could not substitute proof of service.
The Department had not established the address to which the notice was dispatched, the identity of the person who received it, or even produced the speed-post tracking report. The Court therefore declined to draw a presumption of service merely from the Department’s assertion and dispatch-register entries. It consequently found a violation of the principles of natural justice and set aside the assessment order.
The Court granted the petitioner 30 days to respond to the show cause notice and directed the competent authority thereafter to fix and communicate a hearing date. A fresh appropriate order is to be passed within two months from the date of filing of the response to the show cause notice. The writ petition was allowed to this extent.
FULL TEXT OF THE PATNA HIGH COURT ORDER
Heard Mrs. Archana Sinha, learned senior counsel for the petitioner and Dr. K.N. Singh, learned Additional Solicitor General assisted by Mr. Anshuman Singh, learned Sr. Standing Counsel for the Department of CGST & CX.
2. This writ application has been preferred seeking the following reliefs:-
“(a) Issue a writ of certiorari quashing the ex parte assessment order dated 11.12.2023 and the consequential demand raised as DRC – 07 by the Respondent;
(b) Issue a writ of mandamus directing the respondents to provide the petitioner with a proper opportunity to present his case, including a fresh hearing, before the finalization of any assessment order.”
3. The bone of contention in the present writ application is as to whether the show cause notice dated 20.03.2023 (Annexure ‘P/1’) was duly served upon the petitioner. While it is the stand of the petitioner that he had not received the show cause notice (Annexure ‘P/1’), the department has taken a stand that the show cause notice was placed on the GST portal on 20.03.2023, in addition it was also sent through speed post. To show that the show cause notice was sent through speed post, the respondents have placed a xerox copy of the page of the dispatch register as Annexures-‘R/A’, ‘R/B’ and ‘R/C’ to the counter affidavit. It is contended that by sending the notices through speed post in addition to putting the same on portal, the respondents have complied with the directions of this Court in its various judgments with regard to the manner in which the notices are to be served.
4. Learned senior counsel for the petitioner submits that in the rejoinder filed by the petitioner, the petitioner has specifically stated that he had not received the show cause notice and the speed post. It is contended that the DIN number stated in the show cause notice is manually written on the notice, which is in violation of Circular No.128/47/2019 (GST) dated 23.12.2019. This Circular mandates for electronic generation of DIN in respect of all forms of communications including e-mails sent to tax payers.
5. In course of his submissions, Dr. K.N. Singh, learned A.S.G. made efforts to impress upon the Court that if the speed post was not returned undelivered then there would be a presumption of service of the speed post on the addressee. It is, however, admitted that so far as uploading of DRC – 07 is concerned, it was uploaded after expiry of a period of three months which was the statutory period available to the petitioner to prefer an appeal under sub-Section 4 of Section 107 of the CGST Act.
6. Learned ASG submits that the consequence of not uploading the DRC – 07 for more than three months may be neutralized by directing the appellate authority that in case an appeal is preferred against the impugned order, the period of limitation shall not come in the way of maintaining an appeal. To that extent, the respondents do not contest the submissions of learned senior counsel for the petitioner that DRC – 07 was not uploaded and it was received by the petitioner after the expiry of period of limitation for preferring an appeal.
7. Having heard learned counsel for the parties and on perusal of the records, we find that the impugned assessment order in this case is an ex parte assessment order. The petitioner has vehemently contended that the show cause notice was not served upon him. He has gone to the extent of swearing affidavit in the rejoinder saying that the speed post was also not served. The respondents have, though, filed xerox copy of the page of the dispatch register to show that the speed post was dispatched but in our considered opinion, mere dispatch of the show cause notice would not take place of the proof of the service of notice. No such presumption may be drawn by this Court on the basis of the bald statement that the notice was dispatched by speed post. It is not known as to on which address it was dispatched and who received the notice. The respondents did not take pain to even download the track report of the speed post.
8. In such circumstance, we are of the opinion that the petitioner has been able to make out a case of violation of principles of natural justice. The show cause notice not having proved to have been served upon the petitioner, we set aside the impugned order of assessment.
9. The petitioner is given an opportunity to file a response to the show cause notice within a period of 30 days from today, whereafter the competent authority shall fix a date of hearing and communicate the same to the petitioner. The petitioner shall appear before the competent authority on the date(s) fixed in the matter from time to time. The competent authority shall take a final view on the matter and pass an appropriate order within a period of two months from the date of filing of the show cause.
10. This writ application is allowed to the extent indicated hereinabove.
