2022 (3) TMI 792 - HC - GST

Principles of natural justice - validity of SCN - pre-show cause consultation before issuing the show cause notices not conducted - demand of duty is above ₹ 50 lakhs - violation of the Master Circular dated 10th March, 2017 read with Instructions dated 21st December, 2015 - HELD THAT - Issue notice. List on 04th August, 2022.

Summary

Issues:
Challenge to demand-cum-show cause notice dated 05th July, 2018 and Statement of Demand for financial years 2016-17 and 2017-18. Violation of pre-show cause consultation requirement for demands above ?50 lakhs.

Analysis:

Challenge to Demand-Cum-Show Cause Notice:
The petitioner filed a writ petition challenging the demand-cum-show cause notice dated 05th July, 2018 issued by the Commissioner, CGST Delhi East, along with the Statements of Demand for the financial years 2016-17. The petitioner also sought a direction for the respondent to provide a copy of the statement of demand dated 21st August, 2019. The petitioner contended that the respondent erred by not conducting a pre-show cause consultation before issuing the impugned show cause notices, which is mandatory for demands exceeding ?50 lakhs. The petitioner argued that the failure to initiate pre-show cause notice consultation violated the Master Circular dated 10th March, 2017, along with Instructions dated 21st December, 2015.

Violation of Pre-Show Cause Consultation Requirement:
The court issued notice on the matter, with the learned senior standing counsel for the respondent accepting notice on behalf of the respondent. The respondent was granted four weeks to file a counter affidavit, with the provision for a rejoinder affidavit if necessary before the next hearing scheduled for 04th August, 2022. The court noted that no interim order was necessary as the impugned show cause notices related to the years July 2018 and August 2019. Consequently, the application challenging the demand-cum-show cause notice and the Statements of Demand for the specified financial years was dismissed by the court.

This detailed analysis of the judgment highlights the issues raised by the petitioner regarding the demand-cum-show cause notice and the violation of the pre-show cause consultation requirement, providing a comprehensive understanding of the legal proceedings and decisions made by the court.