A Single Bench of the Calcutta High Court has quashed an order issued under Section 73(9) of the Goods and Services Tax Act, 2017, for non-consideration of hearing extension/adjournment application submitted by the petitioner.
A Show-cause under Section 73(1) of the GST Act had been issued against the petitioner. The respondent no.1 had granted liberty to petitioner to file its response on/or before 25th October, 2023, though personal hearing was offered only on 10th October, 2023. The petitioner claims that the petitioner had closed down its business and surrendered its GSTIN in the year 2020.
According to the petitioner, by reasons of Durga Puja, the petitioner could not appropriately prepare its response and further since, the office of the respondents were closed between 16th October, 2023 and 29th October, 2023, the petitioner had applied for extension immediately on the reopening of the office of the respondent no.1 on 30th October, 2023 by a notice in writing of
even date. The same was followed up by a response in the GST portal dated 6th November, 2023 wherein the factum of seeking extension for giving its reply was also recorded.
As such, it was difficult to give its response within a short time. The petitioner also claims that immediately after reopening of the office of the respondent no.1 on 30th October, 2023 it had applied in writing and had sought for an extension to file its response.
The same was subsequently followed up by its response/extension application dated 6th November, 2023 filed on the GST portal wherein the petitioner had also sought for personal hearing in writing.
It was remarked that, once the petitioner had sought for an extension, the respondent no.1 was obliged to consider the application for extension and ought not to have passed the final order without appropriately considering the petitioner’s application for extension. The final order was also not passed immediately. The same was passed on 20th December, 2023, which is more than a month from the date the petitioner had sought for extension.
The Bench of Justice Raja Basu Chowdhury observed that, “Although, the discretion to grant an adjournment vests in the authority, in my view such discretion must be exercised judiciously. The manner in which the respondent no.1 has proceeded to pass the final order without granting extension to the petitioner either to file its response or to be offered personal hearing, despite the petitioner showing sufficient cause, appears to be a colorable exercise of power by the said authority.”
It was thus held that, ‘since, the order stands vitiated on the ground of violation of the principles of natural justice, alternative remedy in the form of an appeal is no bar for exercise of extraordinary writ jurisdiction. Having regard to the aforesaid, since the impugned order cannot be sustained, the same is set aside.”
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