Nektar Therapeutics India Pvt Ltd Vs Union of India
Date: June 22, 2023
Subject Matter
Assistant Commissioner is not the proper officer to issue SCN for the recovery of a previously granted refund
Summary
The case involves a writ petition challenging a show cause notice issued by the Assistant Commissioner of Central Tax, Central Excise & Service Tax, Medchal Division, Medchal Commissionerate. The petitioner's counsel argues that the Assistant Commissioner is not the proper officer as clarified by a circular issued by the Central Board of Excise and Customs. The respondents' counsel concedes to this contention and suggests that the show cause notice may be set aside and reissued by the proper officer. The petitioner's counsel further argues that the show cause notice seeks to recover a refund granted to the petitioner, but the petitioner's claim for the refund was affirmed by the jurisdictional Customs, Excise & Service Tax Appellate Tribunal. The court ultimately sets aside the show cause notice, but allows the petitioner to be consulted if a fresh show cause notice is to be issued.
FULL TEXT OF THE JUDGMENT/ORDER OF TELANGANA HIGH COURT
Heard Mr. Sandeep Chilana, learned counsel for the petitioner; Mr. Gadi Praveen Kumar, learned Deputy Solicitor General of India for respondent No.1; and Mr. Dominic Fernandes, learned counsel for respondents No.2 to 6.
2. Challenge made in this writ petition is to the show cause notice No.04/2023-24 dated 17.04.2023 issued by respondent No.5 i.e., Assistant Commissioner of Central Tax, Central Excise & Service Tax, Medchal Division, Medchal Commissionerate.
3. Though the challenge has been made on various grounds, learned counsel for respondents No.2 to 6 fairly concedes to the contention advanced by learned counsel for the petitioner that respondent No.5 i.e., Assistant Commissioner, is not the proper officer as clarified by circular No. 31/05/2018-GST dated 09.02.2018 issued by the Central Board of Excise and Customs inasmuch as the proper officer would be Additional or Joint Commissioner of Central Tax. Therefore, he submits that the show cause notice may be set aside with liberty to the respondents to issue the same afresh by a proper officer.
4. At this stage, learned counsel for the petitioner submits that the show cause notice has been issued for recovery of refund earlier granted to the petitioner. The recovery is sought to be made on the ground that the refund was made erroneously. He submits that insofar refund is concerned, claim of the petitioner was affirmed by the jurisdictional Customs, Excise & Service Tax Appellate Tribunal (CESTAT) which order has attained finality. Therefore, judicial discipline and propriety demands that respondent should be restrained from taking steps for recovery of the refund granted.
5. Having heard learned counsel for the parties, particularly the submission of learned counsel for respondents No.2 to 6, we set aside the show cause notice dated 17.04.2023 making it clear that proper officer shall hold consultation with the petitioner if he intends to issue fresh show cause notice i.e., pre show cause notice consultation. All contentions are kept open.
6. Writ petition is accordingly allowed.