2021 (7) TMI 391 - HC - GST

Period of limitation for filing an appeal - exclusion of time during COVID lockdown period - ex-parte order - opportunity of hearing not provided - violation of principles of natural justice - HELD THAT - This Court, notwithstanding the statutory remedy, is not precluded from interfering where, ex facie, we form an opinion that the order is bad in law. This is for two reasons- (a) violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case; (b) order passed ex parte in nature, does not assign any sufficient reasons even decipherable from the record, as to how the officer could determine the amount due and payable by the assessee. The order, ex parte in nature, passed in violation of the principles of natural justice, entails civil consequences. Petition disposed off.

Issues:
1. Quashing of demand order and appeal dismissal based on limitation during COVID period.
2. Interpretation of Section 16(4) of the CGST/BGST Act for claiming input tax credit.
3. Imposition of tax, interest, and penalty by the Respondents.
4. Coercive action against the Petitioner and refund of recovered amounts.
5. Direction for extension in availment of Input Tax Credit.
6. Violation of principles of natural justice in the order passed.
7. Deposit requirements for hearing the appeal.
8. De-freezing/de-attaching of bank accounts.
9. Directions for the Assessing Authority to decide the case on merits.
10. Liberty reserved for challenging the order and taking other remedies.
11. Conducting proceedings through digital mode during the pandemic.

Detailed Analysis:

1. The petitioner sought relief in quashing the demand order and appeal dismissal due to limitation during the COVID period. The Court acknowledged the delay due to COVID restrictions and decided to interfere despite statutory remedies due to violations of natural justice in the ex parte order. The impugned orders were quashed, and the case was remanded to the Assessing Authority for a fresh decision on merits without coercive steps during the proceedings.

2. The petitioner requested an interpretation of Section 16(4) of the CGST/BGST Act for claiming input tax credit. The Court did not express an opinion on merits, leaving all issues open for future challenges and remedies while directing the Assessing Authority to decide the case expeditiously and affording opportunities for all concerned parties.

3. Concerning the imposition of tax, interest, and penalty by the Respondents, the Court found the order passed ex parte in violation of natural justice, leading to civil consequences. The Court set aside the impugned orders and directed the petitioner to deposit a certain amount for hearing the appeal, subject to refund if found in excess.

4. The Court directed for de-freezing/de-attaching of the bank accounts of the petitioner and ensured no coercive steps were taken during the pendency of the case. Any recovered amounts were to be refunded within a specified timeframe, and the petitioner was required to cooperate fully in the proceedings.

5. Additionally, the petitioner requested a direction for extension in availment of Input Tax Credit under Section 16 of the GST Act. The Court did not express an opinion on this issue but reserved liberty for the petitioner to challenge the order and take other remedies as available in accordance with the law.

6. The Court highlighted the importance of conducting proceedings through digital mode during the pandemic, ensuring timely and efficient resolution of legal matters. The judgment concluded by disposing of the petition and interlocutory applications in the specified terms, with the respondents undertaking to communicate the order electronically to the appropriate authority.

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