Case Law Details
Mohd. Naseem Khan Vs State of Madhya Pradesh And Others (Madhya Pradesh High Court)
The Madhya Pradesh High Court dismissed a writ petition challenging an order passed under Section 74 of the CGST Act for the financial year 2018-19. The petitioner, running a restaurant business under a proprietorship firm, had received notices alleging mismatch between GSTR-1 and GSTR-3B returns. A notice under Section 61 sought tax of Rs.34.34 lakh, followed by a DRC-01 notice under Section 74 demanding tax, interest, and penalty. The petitioner did not respond to either notice, claiming unawareness as the notices were uploaded on the GST portal. An ex parte order dated 11.04.2023 confirmed the demand. The appeal filed before the appellate authority was dismissed as time-barred and for non-compliance with the mandatory pre-deposit requirement. The petitioner argued before the High Court that the demand exceeded the amount specified in the show-cause notice and violated Section 75(7) of the Act. The Court held that the petitioner failed to establish lack of knowledge of notices, remained negligent in pursuing statutory remedies, failed to seek condonation of delay, and could not invoke writ jurisdiction to bypass statutory remedies and pre-deposit requirements. The Court also noted that the petitioner had an alternative remedy before the GST Tribunal. Accordingly, the writ petition was dismissed.
FULL TEXT OF THE JUDGMENT/ORDER OF MADHYA PRADESH HIGH COURT
The petitioner has filed this present petition being aggrieved by order dated 11.04.2023 (Annexure P-1), passed by the Assistant Commissioner of State Tax, Vidisha Circle, Bhopal Division under section 74 of the Central Goods and Service Tax Act, 2017 pertaining to the financial year 1st April, 2018 to 31st March, 2019 and order dated 03.03.2025 (Annexure P-9), whereby 1st Appellate Authority i.e Joint Commissioner of the State Tax, Bhopal Division has dismissed the appeal.
2. The petitioner has been running business in the name of proprietorship firm under the Trade name of Radisson Binakurwai Road Restaurant. The petitioner obtained GST Number and certificate. The respondent no.3 issued a show-cause notice ASMT-10 under section 61 on 02.01.2021 (Annexure P-3) alleging mismatch in GSTR-1 and GSTR-3B return. The petitioner was called upon to deposit a tax of Rs.34,34,082/-. The petitioner did not submit any reply to the said notice on the pretext of unawareness of issuance of any such notice. Thereafter the respondent issue a notice under section 74 on 06.02.2021 (Annexure P-4). Vide DRC-01 demanding tax of Rs.34,50,938/- along with interest Rs.18,30,340/- and penalty Rs.8,62,734/-. Again, the petitioner did not submit any response to the said show-cause notice as the said notice was issued on additional notice tab. The respondent no.3 passed an ex parte order dated 11.04.2023 (Annexure P-1) confirming the demand under section 74 of the CGST/MP GST Act, 2017. The petitioner submitted an appeal before the Commissioner without deposit of mandatory amount of tax as pre-deposit condition. Learned Commissioner has dismissed the appeal vide order dated 03.03.2025 (Annexure P-9) as time barred. Hence, this petition before this Court inter alia on the ground that the impugned demand is in violation of section 75(7) of the Act of 2017 as the amount of tax, interest and penalty demanded in the order is exceeding the amount specified in the show-cause notice. The petitioner has surrendered the GST license with the department on 12.04.2021 and which has been accepted by the respondent.
3. According to the petitioner, he came to know about the aforesaid demand and orders only when he tried to sell land by reaching office of Sub Registrar and he was stopped to execute the sale deed as the demand of GST is pending against him.
4. It cannot be believed that the petitioner had no knowledge about the notice issued under section 61, 74 and the final order passed by the respondent. All notices and orders were published in the GST portal. The petitioner has not filed any document to show that these notices were published in the additional tab. The appellate court has observed that the petitioner did not deposit 12.5.% of the amount, which is mandatory before entertainment of the appeal. He remained absent from personal hearing on 28.03.2024 and 18.10.2024. No application for condonation of delay has been filed; therefore, the petitioner was through out negligent in pursuing the remedies before the GST Authorities. Therefore, he cannot be permitted to invoke the jurisdiction of writ court. The writ petition cannot be entertained in order to by-pass the statutory remedy, avoidance to deposit 12% amount and delay in filing appeal is beyond the period of limitation. The petitioner has a remedy of filing appeal before the GST Tribunal against the impugned order. Accordingly, this writ petition is dismissed.
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