2024 (3) TMI 1312 - HC - GST

Demand of GST - Validity of the order in FORM GST DRC-07 - Violation of natural justice - impugned order was passed before the period of 15 days could expire and the petitioner-Firm has therefore not been given a fair opportunity to put forth its defence to SCN - Appealable order or not - HELD THAT - In the first place, a challenge to the show-cause notice, charge memo or charge-sheet is generally not entertained in a proceeding under Article 226 of the Constitution of India. There is a sound policy in law behind this rule of non-interference that the aggrieved person should first avail of the remedy provided under the statutory regime. The impugned order dated 28th December 2023 passed by the State of Tax Officer, Special Circle, Ranchi is appealable under section 107 of the GST Act and under section 107 of the JGST Act. The summary of show-cause notice is dated 13th December 2023. Through this notice, the petitioner-Firm was intimated that within 15 days if it deposits the assessed amount or provides satisfactory reply the notice shall be withdrawn. Now the stand of the petitioner-Firm is that it submitted a detailed show-cause reply dated 29th December 2023 but before that the impugned order dated 28th December 2023 has been passed - The notice is dated 13th December 2023 and the petitioner-Firm itself affirms that the said notice was mailed on 16th December 2023 in FORM DRC-1. The petitioner-Firm is required to approach the appellate authority who shall have the benefit of the records and would be in a better position to adjudicate the disputes on facts - this Court is not inclined to entertain the present writ petition which is dismissed only on the ground that no case is made out for entertaining this petition notwithstanding the statutory regime under the JGST Act. Petition dismissed.

Summary

Issues involved: Allegation of an illegal, arbitrary, and mala fide order in violation of natural justice regarding a show-cause notice under section 73(1) of the Jharkhand Goods and Service Tax Act, 2017.

The petitioner-Firm, aggrieved by an order in FORM GST DRC-07, challenged the order dated 28th December 2023, alleging it was passed illegally, arbitrarily, and mala fide, without providing a fair opportunity to respond to the show-cause notice for the financial years 2017-18 and 2018-19.

The petitioner contended that the order was passed before the expiry of the 15-day period, preventing them from adequately presenting their defense as required by law. Reference was made to legal precedents highlighting the necessity of a personal hearing before imposing additional demands on an assessee.

The Court noted that generally, challenges to show-cause notices are not entertained under Article 226 of the Constitution, emphasizing the importance of exhausting statutory remedies available under the law. The impugned order was found appealable under section 107 of the GST Act and JGST Act.

Citing legal precedent, the Court highlighted that writ jurisdiction should not ordinarily be exercised to quash a show-cause notice, as it does not infringe upon any party's rights until a final adverse order is passed. The petitioner's submission of a detailed show-cause reply after the impugned order was issued raised procedural concerns.

Given the factual circumstances, the Court directed the petitioner-Firm to seek recourse before the appellate authority, which would be better equipped to adjudicate the matter based on the available records and facts.

Ultimately, the Court declined to entertain the writ petition, dismissing it on the grounds that it did not establish a case for judicial intervention, emphasizing the importance of adhering to the statutory regime under the JGST Act.