The Allahabad High Court has asked the assessee to pre-deposit 50% of disputed tax for not filing the reply to the show cause notice.
The bench of Chief Justice Arun Bhansali and Justice Vikas Budhwar has observed that a perusal of the show cause notice, issued under Section 74(1), revealed that though the reply filed by the petitioner has been considered, apparently, only part of it has been quoted and the other pleas which were raised, apparently, have not been taken into consideration. As apparently, no response to the show cause notice was filed and no appearance was made, while passing the order in DRC-01, the same show cause notice has been reproduced noticing that no response has been given and no appearance has been made.
The petitioner/assessee was issued notice under Section 74(5) of the Uttar Pradesh Goods and Services Tax Act, 2017 to which reply was filed. By order dated 30.05.2023, rejecting the reply, show cause notice was issued under Section 74(1) granting time till 30.06.2023 to file reply, it is claimed that on account of some family dispute, the petitioner, being unaware of the issuance of notice, could not attend the said hearing as fixed, which resulted in passing of the order raising a demand of Rs. 73,87,225.92.
Various submissions have been made seeking to question the validity of the order passed including the fact that though a detailed response was given to DRC-01A, however, only part of it was reproduced in the notice DRC-01, even the same was not considered.
The petitioner has already lost the limitation as provided under Section 107 of the Act and as such, in case, the petitioner is not afforded opportunity, which it could not avail on account of family circumstances, the petitioner would suffer.
The department contended that he plea, sought to be raised pertaining to the family dispute, cannot be a reason enough for the petitioners to seek a rehearing when the orders have been passed after due consideration by the Assessing Authority and in those circumstances, no interference is called for in the impugned order.
A perusal of the show cause notice, issued under Section 74(1), reveals that though the reply filed by the petitioner has been considered, apparently, only part of it has been quoted and the other pleas which were raised, apparently, have not been taken into consideration.
As apparently, no response to the show cause notice was filed and no appearance was made, while passing the order in DRC-01, the show cause notice has been reproduced noticing that no response has been given and no appearance has been made.
The court held that in the overall fact situation of the case, the department on account of circumstances, has lost the limitation for filing appeal and the fact that to some extent, the pleas raised by the petitioner have not been taken into consideration while issuing the notice under Section 74(1), in the peculiar circumstances of the case, we deem it appropriate and therefore, order that in case, the petitioner deposits 50% of the demand Rs. 73,87,225.92 raised, after taking into consideration the amount, if any, already deposited, within a period of four weeks, the order dated 24.07.2023 shall stand set aside, the respondent would afford opportunity of hearing to the petitioner and pass fresh order.
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Case Details
Case Title: M/S Kashi Vishwanath Mfg and another Versus State of U.P.
Case No.: WRIT TAX No. – 2096 of 2024
Date: 3.12.2024
Counsel For Appellant: Anurag Mishra, Pragya Pandey
Counsel For Respondent: C.S.C., Ankur Agarwal
