GST Update

 Desk of CA. Praveen Sharma – 986 Series (CAPS) 

GAUHATI HIGH COURT IN THE CASE OF S3 Enterprise 

The Court heard submissions from both sides, including the counsel for the petitioners and the CGST department.

The petitioners challenged a recovery notice dated 04.01.2024, which demanded service tax of ?4,96,375 along with interest and penalty based on an Order-in-Original dated 19.07.2021.

The petitioners contended that they had neither received the show cause notice dated 07.07.2020 nor any hearing intimation, and were unaware of the adjudication proceedings. Only upon seeking clarification from the department did they receive a copy of the order via email.

The department argued that communications were sent through registered post and were not returned undelivered, implying presumed service.

The petitioners denied receipt of any such communication and claimed denial of opportunity, thereby violating principles of natural justice.

The Court observed that adequate opportunity had not been ensured and held that the matter should be reconsidered to uphold fairness.

Accordingly, the Court directed the department to restart proceedings by supplying a copy of the original show cause notice and granting sufficient time, including a personal hearing, to the petitioners.

The petitioners were permitted to collect the notice from the department’s office and required to file their reply within 30 days from receipt.

Consequently, both the recovery notice dated 04.01.2024 and the Order-in-Original dated 19.07.2021 were set aside.

The writ petition was disposed of with these directions.

LINK:CA. Praveen Sharma on Linkedin

Regards
CAPS