Case Note & Summary
The Petitioner, West India Continental Oils Fats Pvt. Ltd., a company registered under the Companies Act, 2013, filed a writ petition under Article 226 of the Constitution of India before the Bombay High Court. The Petitioner challenged an assessment order passed under Section 73 of the Central Goods and Services Tax Act, 2017, by the Assistant Commissioner, Division IV CGST & Central Excise, Mumbai Central. The Petitioner contended that the show cause notice issued to them proposed to deny Input Tax Credit (ITC) on certain specified invoices, but the final assessment order denied ITC on entirely different invoices. This discrepancy, according to the Petitioner, violated the principles of natural justice as they were not given an opportunity to respond to the grounds on which the final order was based. The Respondents, represented by Mr. Y.R. Mishra, argued that the order was valid and within the scope of the notice. The Court, after hearing both sides, observed that the show cause notice and the assessment order must be consistent to afford the assessee a fair opportunity. Since the grounds in the notice and the order were different, the order was held to be unsustainable. The Court allowed the petition, set aside the impugned assessment order, and remanded the matter back to the Assessing Officer for fresh adjudication after giving the Petitioner a proper hearing. The Court directed that the Petitioner be given a fresh show cause notice and an opportunity to respond before any new order is passed.
Headnote
A) Constitutional Law - Writ Jurisdiction - Article 226 of the Constitution of India - Certiorari - Petitioner challenged assessment order under GST alleging violation of natural justice - Court held that where show cause notice and final order are based on different grounds, the order is liable to be set aside for violating principles of natural justice (Paras 1-10). B) Goods and Services Tax - Assessment - Section 73 of the Central Goods and Services Tax Act, 2017 - Show Cause Notice - The show cause notice proposed to deny Input Tax Credit on certain invoices, but the final assessment order denied credit on entirely different invoices - Held that such discrepancy amounts to denial of reasonable opportunity and the order cannot be sustained (Paras 5-8).
Issue of Consideration
Whether an assessment order passed under Section 73 of the CGST Act, 2017 is sustainable when the show cause notice and the final order are based on different grounds, thereby violating principles of natural justice.
Final Decision
The Court allowed the petition, set aside the impugned assessment order, and remanded the matter back to the Assessing Officer for fresh adjudication after giving the Petitioner a proper hearing. The Petitioner is to be given a fresh show cause notice and an opportunity to respond before any new order is passed.
Law Points
- Natural justice
- Show cause notice
- Assessment order
- Different grounds
- Prejudice
- Section 73 of CGST Act
- 2017
- Article 226 of Constitution of India
