2023 (8) TMI 779 - HC - GST

Validity of SCN issued u/s 73 of the WBGST Act - It is the submission of the learned advocate for the appellant that the show cause notice is dated 10th May, 2023 but the report (report in the matter of the appellant/assessee) is dated 8th May, 2023 and therefore, the same cannot be treated as a show cause notice. HELD THAT - On a perusal of the report, it is seen that it has been explicitly stated that the appellant is required to show cause as to why it should not pay the amount specified in the table in the said report along with the interest payable and penalty leviable thereon. Therefore, the assessee should treat the annexure to the notice i.e. the report dated 8th May, 2023 as the material based on which they are called upon to show cause as to why the tax, which has been computed should not be recovered along with the interest and penalty. The show cause notice is neither vague nor lacking in particular and it is for the appellant/assessee to raise all contentions in its reply, which will include the contention regarding the pecuniary jurisdiction and the authority, which has issued the show cause notice. In any event, the issue as to whether a show cause notice is bad and lacks detail or is unintelligible to qualify to be a show cause notice cannot be put in a straight-jacket formula and has to be decided considering the facts and circumstances of the cases on hand. The learned single Bench rightly refused to interdict the show cause notice. Accordingly, the appeal fails and the same is hereby dismissed along with the connected application.

Summary

Issues involved:
The appeal challenges the Constitutional validity of rule 42(3) of the CGST Rules, 2017 and the show cause notice issued under section 73 of the WBGST Act.

Judgment Details:

Challenge to Constitutional Validity of Rule 42(3) of CGST Rules, 2017:
The appellant sought a writ of declaration against rule 42(3) of the CGST Rules, 2017. The single Bench entertained this challenge but did not interfere with the show cause notice issued under section 73 of the WBGST Act. The appellant appealed this decision, arguing that the show cause notice lacked specificity and validity. The appellant cited legal precedents to support the contention that the notice was deficient.

Validity of Show Cause Notice:
The appellant argued that the show cause notice was invalid due to lack of specific reasons, vagueness, and absence of necessary details. The appellant also contended that the input tax availed did not need to be reversed until the completion certificate was issued. Additionally, the appellant claimed that the notice lacked pecuniary jurisdiction, referencing a circular by the Central Board of Excise and Customs.

Court's Analysis and Decision:
The Court examined the contentions raised by both parties. It noted that the show cause notice was issued under section 73 of the WBGST Act, included demand details, and was sent to the appellant's registered email along with necessary forms. The Court rejected the appellant's argument that the notice was invalid due to discrepancies in dates, highlighting that the appellant had been given opportunities to respond prior to the issuance of the formal notice.

The Court emphasized that the show cause notice was clear and specific, allowing the appellant to raise all contentions in its reply. It differentiated the present case from legal precedents cited by the appellant, concluding that the notice in question met the necessary requirements. The Court upheld the single Bench's decision not to interfere with the show cause notice, dismissing the appeal and granting the appellant time to submit a reply to the notice.

In conclusion, the Court dismissed the appeal, allowing the appellant to respond to the show cause notice within a specified timeframe. No costs were awarded, and the parties were directed to receive certified copies of the order promptly.