The court established that under GST Rules, there is no obligation to provide a hearing before issuing a show cause notice, as the communication is discretionary.

ORDER :

1. The petitioner has preferred this writ petition aggrieved by non-consideration of the reply given pursuant to the notice given under GST DRC-01A.

2. It is contended by learned counsel for the petitioner that as per Rule 142(1A) of the Rajasthan Goods & Service Tax (RGST)/Central Goods & Service Tax (CGST) Rules, 2017 (for short “Rules of 2017), notice is to be served and if reply is given under Rule 142(2A) of the Rules of 2017, the authorities are required to consider the reply before issuing show cause notice under Rule 142(1)(a).

3. It is also contended that there is no provision under the Rules or the Act for affording an opportunity of hearing. The Calcutta High Court has interpreted the provisions and has held that in pre show cause intimation also, the authorities are required to afford an opportunity of hearing before issuing a show cause notice under Rule 142(1)(a) of Rules of 2017. Reliance, in this regard, has been made on the judgment passed by Calcutta High Court in the case of Eden Real Estate Pvt. Ltd. & Anr. Vs. The Senior Joint Commissioner of Revenue Kolkata South Circle, WBGST & Ors. WPA No. 1025/2024 decided on 07th February, 2024 as well as on the judgment passed in the case of Diamond Beverages Private Limited & Anr. Vs. The Assistant Commissioner of CGST & CX, Taltala Division II Kolkata South Commissioner & Ors. M.A.T. 1948/2023 in I.A. No. CAN 1 of 2023 decided on 15th February, 2023.

4. It is contended by learned counsel for the petitioner that the case before Calcutta High Court is not different from that of the case before this Court and reply to the intimation was given in the present case also, but the same has not been considered. The only prayer made by learned counsel for the petitioner is that the authorities may be directed to consider the reply filed by the petitioner and then notice under Rule 142(1)(a) of the Rules of 2017 may be issued, if required.

5. Learned Additional Advocate General has put in appearance on advance notice.

6. It is contended by learned Additional Advocate General that provision under the Rule 142(1A) of the Rules of 2017 only provides for giving a communication, that too, is not mandatory, as the word used is “proper officer may”. It is also contended that Rule 142(2A) of the Rules of 2017 provides that if a person referred to in sub-rule (1A) has made partial payment of the amount communicated to him or desires to file any submissions against the proposed liability, he may make such submission in Part B of FORM GST DRC-01A.

7. It is further contended that there is no provision under the Rules for affording an opportunity of hearing or hearing the person referred to in sub-rule (1A) of Rule 142 of the Rules of 2017. It is contended that after a show cause notice is issued under Rule 142(1)(a) and reply of the same is received, there is a provision for affording an opportunity of hearing, but there is no such provision under Rule 142(1A) and Rule 142(2A) of the Rules of 2017.

8. Learned Additional Advocate General has placed reliance on judgment passed by the Apex Court in the case of Commissioner of Central Excise, Haldia Vs. Krishna Wax Private Limited, (2020) 12 SCC 572, relevant paragraphs of which are quoted here under for ready reference:

“13. It must be noted that while issuing a show cause notice under Section 11-A of the Act, what is entertained by the Department is only a prima facie view, on the basis of which the show cause notice is issued. The determination comes only after a response or representation is preferred by the person to whom the show cause notice is addressed. As a part of his response, the concerned person may present his view point on all possible issues and only thereafter the determination or decision is arrived at. In the present case even before the response could be made by the respondent and the determination could be arrived at, the matter was carried in appeal against said Internal Order. The appellant was therefore, justified in