2022 (2) TMI 1109 - HC - GST

Principles of natural justice - no show cause notice is issued for conducting any investigation/enquiry against the petitioners - petitioners have been summoned 20 times - HELD THAT - The respondents are directed to file affidavit and shall deal with the issues raised by the petitioners in the petition and shall also deal with the averments made in paragraph 4.6 of the writ petition. The respondents shall indicate as to how many time summons were issued by the respondents to the petitioners, for what purpose and the progress of the investigation during this period. Affidavit shall also indicate as to when the investigation would be completed by the respondents against the petitioners - A copy of this order shall be forwarded to the Additional Director General of DGGI, Pune to look into the matter personally. There are allegations made by several petitioners in various petitions about the repeated summons issued by the authority under the provisions of Central Goods and Service Tax Act, 2017 for the purpose of harassment, coercion and to compel them to deposit substantial amount not in accordance with law. The respondents shall issue norms as to how many times, such summons can be issued against the parties and for what purpose. Learned counsel for the respondents to inform this Court about compliance of this order on the next date - In view of the petitioners challenging the constitutional validity of Section 16(2)(c) of the Central Goods and Service Tax Act, 2017 and Maharashtra Goods and Service Tax Act, 2017, office is directed to issue notice upon the Attorney General for India and Advocate General for State of Maharashtra, returnable on 28th March 2022. Application disposed off.

Summary

Issues involved:
1. Harassment of petitioners through repeated summonses
2. Lack of show cause notice for investigation/enquiry
3. Recovery of amounts without proper procedure
4. Direction to respondents to file affidavit addressing petitioners' concerns
5. Allegations of harassment and coercion by authority under GST Act
6. Issuance of norms for summons under GST Act
7. Challenge to constitutional validity of Section 16(2)(c) of GST Act

Analysis:
1. The petitioners filed a writ petition citing harassment through 20 summonses between December 2020 and February 2022. They alleged no show cause notice was issued for investigations and amounts were recovered without proper procedure. The court directed respondents to file an affidavit addressing these issues and the progress of the investigation against the petitioners.

2. The court ordered the Additional Director General of DGGI, Pune to personally look into the matter due to allegations of repeated summonses under GST Act for harassment and coercion. Respondents were directed to issue norms on the frequency and purpose of summonses. Compliance with the order was to be informed to the court on the next date.

3. The petitioners challenged the constitutional validity of Section 16(2)(c) of the GST Act. The court directed the office to issue notices to the Attorney General for India and the Advocate General for the State of Maharashtra, returnable on a specified date. If coercive steps for recovery were proposed, the respondents were required to give 7 days' clear notice to the petitioners, who could apply for interim relief in such a scenario.