Part-127-One Pager Snapshot to Latest Case- Vidya Coal Depot v. Additional Commissioner Grade (Appeal) [2023] 155 526 (Allahabad)

The case although pertains to Cancellation of Registration but discusses four important principles relying upon past judicial principles on following issues-

-Can Court import provisions in the statutes to supply any assumed deficiency
-Can Officer be permitted to supplement fresh reasons by means of affidavit which were not part of the SCN
-Does Ex-Parte order need to be passed on the date of hearing itself or can be passed on a later date
-Concept of Vague SCN without any allegation or evidence




In the instant case, On 24-9-2022, a SCN was issued proposing to cancel the registration of the petitioner for the reason assigned therein with the direction of the TTZ authority
and written direction by JC (SIB) B Agra for cancellation of registration of all coal depot. Registration of the petitioner was cancelled vide impugned order dated 14-10-2022 with
effect from 18-8-2022. Feeling aggrieved by the aforesaid order, the petitioner preferred an appeal, but the same has also been rejected by order dated 1-12-2022.

Contention of

The petitioner has not violated any provision of GST Act; more precisely, contained in Section 29 read with Rule 21 of UPGST Act and Rules framed therein. In absence of any
violation of provision in GST, registration cannot be cancelled. It was further submitted that on the date fixed, the authority ought not to have proceeded ex-parte, if petitioner did
not appear, and if the order was passed on the next date, the same cannot sustain in the eye of law

Observation by the

Constitution of TTZ Authority-TTZ authorities have been constituted by Ministry of Environment and Forest, Government of India in exercise of power conferred by sub-clause
1 & 3 of Section 3 of Environment (Protection) Act, 1986, which is known as the Taj Trapaezium Zone Pollution (Prevention and Control) Authority. In exercise of power under
sections 5 & 24 of the said Act, the direction can be issued in the interest of protecting the environment

Observation by the

The Court observed that petitioner was coal trader and from his business activities did not emanate any hazardous thing which is bad for the environment. The Court also further
observed that in the meeting dated 11-5-2022 of TTZ Authority, direction for tax authorities was for passing an appropriate order against 26 coal dealers only and not for all coal
dealers of Agra. It was a matter of common knowledge that under the GST Act, A/c book are to be maintained by every person. There was no finding at any stage to show that
A/c book were not maintained by the petitioner. In absence of such finding, no violation of UPGST Act can be made out. Once, there was no violation of Section 29 read with rule
21, any action taken for cancellation of registration cannot sustain. It was wrongly mentioned that no reply was submitted by petitioner, but the next line mentions the reply date

Observation by the

Relevant Provisions of Environment (Protection) Act-On perusal of Section 5 of Environment (Protection) Act, for the protection of environment, a direction can be issued to
officer or any authority and they shall be bound by the said direction in respect of industry only. From bare perusal of the Section 24 of the Environment (Protection) Act, 1986, it
was evidently clear that if an offence is punishable under the act and the offender was also found guilty of said offence, offender shall be liable to punish under other act and not
under Environment (Protection), 1986 Act. In other word, if any other enactment was in operation, then environment act had overriding effect, but for punishment, it will be under
that Act. Any direction given by TTZ Authorities for cancellation of registration had to be under GST Act. GST authorities cannot blindly follow direction of TTZ Authorities

Court cannot import
provisions in the
statutes to supply any
assumed deficiency

UOI v. Ind- swift Laboratories Limited, (2011) 4 SCC 635- The Court in this case relied upon Commissioner of Sales Tax, U.P. v. Modi Sugar Mills Ltd. reported in (1961)
2 SCR 189 wherein it was stated that in interpreting a taxing statute, equitable considerations are entirely out of place. Nor can taxing statutes be interpreted on any presumptions
or assumptions. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed: it cannot
imply anything which is not expressed; it cannot import provisions in the statutes so as to supply any assumed deficiency

State authority cannot
be permitted to
supplement fresh
reasons by means of

Mohinder Singh Gill v. The Chief Election Commissioner, New Delhi AIR 1978 SC 851-Relying upon the said Judgement wherein it was held that State authority cannot be
permitted to supplement fresh reasons by means of affidavit, the court rejected that appendix annexed as Annexure-24 to the registration certificate as it was never been brought
on record before the first appellate authority or the same was never communicated to the petitioner, as he could not reply the same. Therefore, it appeared to the court that to
improve the case of revenue, such appendix was annexed for the first time in counter affidavit. Therefore, appendix along with the cancellation order cannot be any aid to
respondent authority

If Assessing Officer
proceeds ex-parte, he
either should fix another
date for hearing or pass
the order on that date

M/S Videocon D2h Ltd. v. State of U.P. and 3 Ors. (Writ Tax No. 243 of 2016), - The court also relied upon the said judgement wherein it was held that on the date when the
assessee did not appear, Assessing Authority had the option to proceed ex-parte or fix another date, which in the instant case did not happen. If the Assessing Officer
proceeded ex-parte, he could have fixed another date for ex-parte hearing or after recording the absence of the petitioner could have proceeded ex-parte and passed
an assessment order on that date itself, which in the instant case did not happen. Therefore, any assessment order made on the next date becomes erroneous, as no date was
fixed for making an assessment. Such assessment order passed without due notice is apparently in gross violation of the principles of natural justice. The principles engrafted
in Sangram Singh v. Election Tribunal, AIR 1955 SC 425 is squarely applicable. Thus, in the instant matter court was also of the opinion that, no order of cancellation was passed
on the date fixed for 29-4-2022, but thereafter on 14-10-2022 for which neither any notice nor any communication was made to the petitioner. Further, in the cancellation of
registration order.

vague SCN without any
allegation or evidence,
clearly is violative of
principles of
administrative justice.

Drs. Wood Products Lucknow v. State of U.P., 2022 NTN (Vol.80)-309- The Court also relied upon the decision wherein it was stated that the SCN only contains the ground
that ''tax payer found non-functioning/non-existing at the principal place of business' is at the first instance, clearly depicts the opaqueness of the allegations levelled against the
petitioner. The said SCN did not propose to rely upon any report or any inquiry conducted to form the opinion and on what basis was the allegation levelled that the tax payer was
found non-functioning; it did not indicate as to when the inspection was carried. A vague show-cause notice without any allegation or proposed evidence against the petitioner,
clearly is violative of principles of administrative justice.


The Court thus held that, the impugned order by the assessing authority dated 14-10-2022 & appellate authority date 1-12-2022 could not sustain in the eye of law and thus
quashed the order and the writ petition was allowed