GST Update

 Desk of CA. Praveen Sharma – 882 Series (CAPS) 

Calcutta High Court in the case of Birla Brothers Private Limited and another

The petitioner challenged the Section 73 adjudication order dated 06.03.2023, arguing that it imposed tax, interest and penalty without proper service of notice or opportunity to respond.

It was shown that all notices and the final order were uploaded only under the “Additional Notices and Orders” tab on the GST portal, instead of the main “Notices and Orders” tab. Because of this unconventional placement, the petitioner remained unaware of the proceedings until a later recovery email.

The petitioner argued that uploading the SCN in the wrong tab and not granting a personal hearing amounted to violation of natural justice.

The Court relied on earlier decisions in Sankar Agarwala and Parakh Consulting LLP, where similar uploads under the “Additional” tab were held to be defective service, resulting in invalid adjudication due to denial of a real opportunity to reply.

The Court held that the officer did not comply with Section 75(4) since an adverse order was proposed but no hearing was granted. Service of notice was also not proper as per judicial precedent, and therefore the impugned order could not stand.

Although an appeal remedy existed, the Court refused to compel the petitioner to file an appeal, observing that it would unfairly deny one statutory forum against an order passed without valid service.

The adjudication order dated 06.03.2023 was set aside. The petitioner was given three weeks to file a reply to the original SCN dated 20.01.2023. If the reply is filed within time, the authority must pass a fresh order after hearing. If not, the earlier order will automatically revive. Limitation cannot be raised unless it existed on the date of the original SCN.

LINK: CA. Praveen Sharma on Linkedin

Regards
CAPS