Dhara Enterprises VS Appellate Authority & Joint Commissioner

The petitioner, engaged in the business of Ferrous waste and scrap and registered under the Goods and Services Tax Act, 2017, has approached this Hon’ble Court seeking relief. The petitioner contends that they were served with a notice dated 13.03.2017 under the Act of 2017. They request the following:

(i) This Hon’ble court may kindly be pleased to call for the records of the case below.

(ii) This Hon’ble Court may kindly be pleased to set aside the impugned order dated 19.08.2019 (Annexure P/4) passed by Respondent No.1.

(iii) This Hon’ble Court may kindly be pleased to set aside the impugned order dated 28.05.2019 (Annex.P/2) passed by Respondent No.2.

(iv) Any other appropriate writ/order/direction, which this Hon’ble Court may deem fit and proper also kindly be issued in the interest of justice.

The petitioner contends that the impugned orders, dated 19.08.2019 and 28.05.2019, respectively passed by Respondent No.1 and Respondent No.2, should be set aside. They seek relief from the consequences of these orders, which they argue have adversely affected their business operations and legal rights. They urge the court to issue any necessary directives in the interest of justice.

The petitioner, engaged in the business of Ferrous waste and scrap and registered under the Goods and Services Tax Act, 2017, received a notice on March 13, 2017, under Section 74(1) of the Act. This notice led to the imposition of tax liability and penalty via an order dated May 28, 2019 (Annexure P/2). Subsequently, an appeal was made to the Appellate Authority, which was dismissed through an order dated August 19, 2019 (Annexure P/4).

In response, the petitioner has filed a writ petition seeking relief from the Court. The petitioner’s counsel argues that there has been a violation of the principles of natural justice. Specifically, it is contended that the authorities failed to disclose the transactions on which the petitioner allegedly availed Input Tax Credit (ITC) when issuing the notice on March 13, 2019 (Annexure P/1). The petitioner asserts that the absence of such information in Annexure P/1 renders the foundation of the subsequent orders flawed. Furthermore, it is highlighted that the orders lack mention of the business transactions in question.

In light of these arguments, the petitioner requests the Court to review the records of the case and set aside both the impugned orders dated May 28, 2019 (Annexure P/2) and August 19, 2019 (Annexure P/4) issued by the respective respondents. Additionally, the petitioner seeks any other appropriate writ, order, or direction deemed necessary by the Court in the interest of justice.

The petitioner, engaged in the business of Ferrous waste and scrap under the Goods and Services Tax Act, 2017, received a notice on 13.03.2017 under Section 74(1) of the Act. This led to an order dated 28.05.2019 imposing tax liability and penalty on the petitioner. Subsequently, an appeal was made to the Appellate Authority, which was dismissed on 19.08.2019.

The petitioner, feeling aggrieved, has approached the court seeking redressal. Their counsel argues a violation of natural justice, contending that the notice did not provide specifics about the alleged transactions on which Input Tax Credit (ITC) was supposedly availed. The subsequent order, too, lacked such details, leaving the petitioner uninformed and unable to defend themselves adequately. It was only through the appellate order that the petitioner learned about the specific transactions in question.

On the other hand, the respondents argue that on 11.03.2019, it was found that the petitioner had indeed availed ITC benefit in transactions with M/s V.K. Enterprises, Chhatarpur, as mentioned in the communication/notice issued to the petitioner. They contend that the petitioner was well aware of the details of these transactions, as evidenced by their response contained in Annexure R/2.

The petitioner asserts that without proper details in the original notice and order, they were unfairly disadvantaged in defending themselves. They seek the quashing of the impugned order.

In summary, the case revolves around whether the petitioner was adequately informed about the allegations against them and whether there was a violation of natural justice in the proceedings. The court is asked to consider the records of the case, set aside the impugned orders, and issue any other appropriate writ or direction in the interest of justice.

The petitioner, engaged in the business of Ferrous waste and scrap registered under the Goods and Services Tax Act, 2017 (referred to as the “Act of 2017”), received a notice dated 13.03.2017 under Section 74(1) of the Act regarding tax liability. This resulted in an order dated 28.05.2019 imposing tax liability and penalty (Annexure P/2), followed by dismissal of an appeal by the Appellate Authority on 19.08.2019 (Annexure P/4).

The petitioner now seeks intervention from the court through a writ petition, alleging a violation of natural justice. They argue that the notices failed to provide specific transaction details supporting the alleged Input Tax Credit (ITC) availed by the petitioner. Despite repeated requests for clarification, the petitioner claims to have been kept in the dark regarding the nature of the transactions in question. It wasn’t until the appellate order that the petitioner learned about the transactions involving M/s V.K. Enterprises, Chhatarpur, which led to the imposition of liability under Section 74(1).

However, the respondents contend that the petitioner was duly informed about the transactions through a notice dated 11.03.2019, which included details of the goods and the amount of ITC availed. They argue that the petitioner’s response to this notice (contained in Annexure R/2) indicates awareness of the transaction details.

After hearing arguments from both sides and examining the records, the court notes that the petitioner failed to provide a reply to the initial notice dated 11.03.2019 (Annexure P/1) and did not file any application seeking transaction details. Moreover, the petitioner’s claim of seeking documents for clarity was unsubstantiated, as there was no formal request or application made. The court also highlights that the petitioner’s own reply (Annexure R/2) to the notice dated 11.03.2019 acknowledged the transaction with M/s V.K. Enterprises, Chhatarpur.

Consequently, the court finds no merit in the petitioner’s argument regarding lack of transparency or violation of natural justice. The petitioner had been adequately informed about the transactions in question and had the opportunity to respond. Therefore, the court dismisses the petition seeking to set aside the impugned orders dated 28.05.2019 and 19.08.2019, along with any other relief sought, deeming it appropriate in the interest of justice.

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