TMI Blog2023 (4) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... bject by this Court in the case of M/s Godavari Commodities Ltd. [[ 2022 (4) TMI 1026 - JHARKHAND HIGH COURT] ], no opportunity of hearing was granted to the petitioner before passing an order which is adverse to him - It also appears that the relied upon documents which forms the basis of passing of the impugned order, have not been supplied to the petitioners. Let it be made clear that that writ petitions have been decided only on the ground of violation of principles of natural justice and failure to follow the procedure prescribed under the Act - petition allowed. - HON BLE MR. JUSTICE APARESH KUMAR SINGH AND HON BLE MR. JUSTICE DEEPAK ROSHAN For the Petitioner : M/s Sumeet Gadodia, Ranjeet Kushwaha Aakansha Mittal, Advocates For the Respondents : Mr. Sachin Kumar, A.A.G-II : Mr. Ratnesh Kumar, Sr. S.C. (DGGI) Heard learned counsel for the parties. 2. All these writ petitions have been tagged together as petitioners have common grievances. W.P.(T) No. 2091 of 2019 was initially preferred for quashing of the show cause notice bearing reference no. 8656 dated 10.09.2018 (Annexure-13) issued by the respondent no.2 asking him to show cause as to why proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outset, seeks to confine the challenge to the proceedings initiated by the State Tax Officer in respect of each of the petitioners on common grounds inter alia as under: i. No show cause notice in terms of the section 74(1) of the JGST Act, 2017 read with Rule 142 was issued by the Respondent-Authorities. The issuance of the Summary show cause notice cannot substitute the requirement of the proper show cause notice under section 74 of the Act. In this regard learned counsel for the petitioner has placed reliance on decision of this Court in the case of Nkas Services Private Limited Vrs. State of Jharkhand others reported in 2021 SCC Online Jhar 1266. ii. Petitioners have alleged violation of principles of natural justice as they were not granted adequate opportunity and no date of hearing was fixed before the impugned adjudication order was passed. In this regard petitioners have also contended that the relied upon documents, based upon which the adjudication order has been passed, was not supplied to the petitioners. Petitioners, in support of the aforesaid grounds have placed reliance on the decisions in the case of M/s Godavari Commodities Ltd. Vrs. State of Jhar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ST REG-6 under the GST Act, 2017 (Annexure-1 and 2). On inspection being carried out on his registered business premises on 06.04.2018, petitioner applied for cancellation of the registration with the State of Jharkhand on the ground that it was unable to manage its business in the State of Jharkhand on 17.04.2018. Petitioner was directed to appear before the State Tax authority on 09.04.2018 to explain the excess ITC claim in his GSTR-3B vis- -vis his GSTR-2A return. Later on, a notice in GST ASMT-10 dated 04.05.2018 was issued pertaining to the scrutiny of the return of the petitioner which showed discrepancies in figures of inward supplies and outward supplies made by him. Petitioner submitted his reply informing that for January 2018 clerical error had occurred at the time of filing returns before the State of Jharkhand and figures of State of Rajasthan were mentioned instead. Thereafter impugned summary of show cause notice has been issued on 21.08.2018 by the Respondent no.2 Deputy Commissioner of State Tax, Singhbhum Circle, Jamshedpur asking him to show cause as to why he has availed excess ITC in its GSTR-3B return. On the same day the summary of show cause notice was r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rence no. 7575 dated 21.08.2018 having been issued. Similar grounds of lack of proper show cause notice; no opportunity of hearing and non-supply of the relied upon documents have been taken by the petitioner in this case also. Counter affidavit has been filed by the respondent DDGI and State no Jharkhand in this writ petition also. 6. Counter affidavit of the respondent State however does not dispute the contention of the petitioners that no proper show cause notice was issued under Section 74(1) of the JGST Act, 2017 as per the requirement of law and decisions rendered by this Court in the case of NKas Services Pvt. Ltd. (supra). Respondent State have also not been able to dispute that no opportunity of hearing was granted to the petitioners contrary to the mandate of Section 75(4) and (5) of the Act and the ratio rendered by this Court in the case of M/s Godavari Commodities Ltd.(supra). It is also not disputed that relied upon documents, which were the basis for passing summary of the order in GST DRC-07 in the respective cases or the adjudication order in W.P.(T) No. 1594 of 2019 was supplied to the petitioner. Though in W.P.(T) No. 1594 of 2019, learned counsel for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iples of natural justice which is a well-recognized exception for invocation of writ jurisdiction despite availability of alternative remedy. In this regard, it is profitable to quote the opinion of the Apex Court in the case of Oryx Fisheries P. Ltd. (supra) at para 24 to 27 wherein the opinion of the Constitution Bench of the Apex Court in the case of Khem Chand versus Union of India [AIR 1958 SC 300] has been relied upon as well : 24. This Court finds that there is a lot of substance in the aforesaid contention. It is well settled that a quasi-judicial authority, while acting in exercise of its statutory power must act fairly and must act with an open mind while initiating a show-cause proceeding. A showcause proceeding is meant to give the person proceeded against a reasonable opportunity of making his objection against the proposed charges indicated in the notice. 25. Expressions like a reasonable opportunity of making objection or a reasonable opportunity of defence have come up for consideration before this Court in the context of several statutes. A Constitution Bench of this Court in Khem Chand v. Union of India, of course in the context of service juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reunder have to be clearly asserted in the notice so that the noticee has an opportunity to explain and defend himself. 17. As observed herein above, the impugned notice completely lacks in fulfilling the ingredients of a proper show-cause notice under Section 74 of the Act. Proceedings under Section 74 of the Act have to be preceded by a proper show-cause notice. A summary of show-cause notice as issued in Form GST DRC-01 in terms of Rule 142(1) of the JGST Rules, 2017 (Annexure-2 impugned herein) cannot substitute the requirement of a proper show-cause notice. This court, however, is not inclined to be drawn into the issue whether the requirement of issuance of Form GST ASMT-10 is a condition precedent for invocation of Section 73 or 74 of the JGST Act for the purposes of 9 deciding the instant case. This Court finds that upon perusal of Annexure-2 which is the statutory form GST DRC-01 issued to the petitioner, although it has been mentioned that there is mismatch between GSTR-3B and 2A, but that is not sufficient as the foundational allegation for issuance of notice under Section 74 is totally missing and the notice continues to be vague. 18. Since we are of the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. ii. Opportunity of hearing shall be granted where any adverse decision is contemplated. iv. If sufficient cause is shown, the proper officer can adjourn the hearing for reasons to be recorded in writing. v. However, no such adjournment shall be granted for more than three times during the proceedings. 23. From the facts of the present proceedings, it would transpire that on 14th March, 2020, Form GST DRC 01 was issued without specifying any date of hearing and, thereafter, straightaway, an Adjudication Order was allegedly passed on 13th August, 2020 fastening liability of tax, interest and penalty upon the Petitioner. From the order sheet, it is evident that no opportunity of personal hearing was granted to the petitioner and the purported Adjudication Order was passed on 13.08.2020 i.e. on the first date itself after issuance of the summary of show cause notice. This itself clearly reveals that the entire adjudication proceedings have been carried out in stark disregard to the mandatory provisions of the GST Act and in violation of the principles of natural justice and, thus, the Adjudication Orders, allegedly dated 13.08.2020, are liable to be qua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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