2023 (4) TMI 70 - HC - Central Excise

Violation of principles of Natural Justice - case of petitioner is that prior to issuance of show cause notice a pre-show cause notice consultation is mandatory as per the provisions of Master Circular No.1053/02/2017-CX dated 10 March 2017 issued by Central Board - Petitioner contended that though the notice was issued to the Petitioner to attend for pre-show cause notice consultation, though time was given, it was not possible for the Petitioner to attend the pre-show cause notice consultation - HELD THAT - Admittedly pre-show cause notice consultation has been facilitated to the Petitioner in this case. Considering the object behind the pre-show cause notice consultation which is beneficial to the assessee as well as revenue, it is opined that the situation has been remedied by fixing the date for the pre-show cause notice consultation. The learned counsel for the parties leave it to the court to fix the date for pre-show cause notice consultation. Accordingly, the Petitioner will appear before the concerned Adjudicating Authority on 10 April 2023. Concerned Adjudicating authority will thereafter fix a suitable date for pre-show cause notice consultation. If in the pre-show cause notice consultation the Adjudicating Authority is of the opinion that there exists the liability of the Petitioner and show cause notice is to be pursued then it is open to the Petitioner to take necessary steps as may be warranted in law and fact to challenge the show cause notice - Till the pre-show cause notice consultation process is over, the impugned show cause notice shall not be given effect to. Writ Petition is accordingly disposed of.

Summary

Issues:
The judgment involves a challenge to a show cause notice issued by the Additional Commissioner, Central Goods and Services Tax and Central Excise, Mumbai. The grievance is regarding the mandatory pre-show cause notice consultation as per the provisions of Master Circular No.1053/02/2017-CX dated 10 March 2017 issued by the Central Board.

Details of the Judgment:

1. The Petitioner challenged the show cause notice dated 9 February 2022, emphasizing the necessity of a pre-show cause notice consultation as per the relevant circular.

2. The Petitioner's counsel argued that although the notice for pre-show cause notice consultation was given with time, it was not feasible for the Petitioner to attend. The Respondents' counsel contended that sufficient opportunities were provided for the Petitioner to attend the consultation.

3. The Court acknowledged that the pre-show cause notice consultation had been facilitated to the Petitioner in this case. Recognizing the importance of this consultation for both the assessee and revenue, the Court directed the Petitioner to appear before the Adjudicating Authority on 10 April 2023 for the consultation, with the Authority to subsequently set a suitable date for the consultation.

4. It was clarified that if during the consultation, the Adjudicating Authority finds the Petitioner liable and decides to pursue the show cause notice, the Petitioner can take necessary legal steps to challenge the notice.

5. Until the completion of the pre-show cause notice consultation process, the impugned show cause notice shall not be enforced.

6. The Writ Petition was disposed of in accordance with the above directions, ensuring the Petitioner's opportunity to participate in the pre-show cause notice consultation before further actions are taken.