The Calcutta High Court reaffirms that in the event of a dispute over service of the order-in-original in CGST/service tax proceedings, and where statutory remedies are available, the Court should not resolve factual disputes in writ jurisdiction but enable the assessee to file a statutory appeal upon proper service; previous recovery demands are set aside until this process is completed. The judgment upholds existing precedents and serves as binding authority within West Bengal for procedural handling in contested service situations.
Summary
| Category | Data |
|---|---|
| Case Name | WPA/12844/2025 of ARUP KUMAR DUTTA AND ANR. Vs UNION OF INDIA AND ORS. |
| CNR | WBCHCA0263152025 |
| Date of Registration | 12-06-2025 |
| Decision Date | 10-09-2025 |
| Disposal Nature | DISPOSED |
| Judgment Author | HON’BLE JUSTICE RAJA BASU CHOWDHURY |
| Court | Calcutta High Court |
| Precedent Value | Binding on subordinate courts in West Bengal; persuasive for other forums |
| Overrules / Affirms | Affirms procedural approach; does not overrule prior precedent |
| Type of Law | Procedural law under Finance Act, 1994 and CGST Act, 2017 |
| Questions of Law |
|
| Ratio Decidendi |
The Court held that where there is a dispute regarding the service of the order-in-original and a statutory remedy is available, the writ court should not entertain disputed facts. The Respondents are directed to provide a signed copy of the order to the petitioner, enabling recourse to the appellate authority as prescribed by law. Recovery demands issued prior to proper service are set aside, as the right of appeal accrues only upon receipt of the order. The judgment thus ensures procedural fairness while affirming the hierarchy of statutory remedies under the Finance Act, 1994 and CGST Act, 2017. |
| Facts as Summarised by the Court |
Petitioners challenged two recovery notices based on an order-in-original dated 28-06-2024, alleging non-service of the order; Respondents showed prior notices were emailed but the order was served only by speed post; Court chose not to resolve disputed facts on service in writ, but directed proper service and liberty to appeal. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts in West Bengal |
| Persuasive For | Other High Courts and tribunals dealing with similar procedural service disputes in revenue cases |
| Follows | Follows established principle that writ jurisdiction is not to be invoked for disputed questions of fact where a statutory appeal lies |
What’s New / What Lawyers Should Note
- Reinforces that in service tax/CGST disputes, writ jurisdiction will not be invoked merely due to disputed factual questions regarding service of order-in-original.
- If a petitioner alleges non-service, but prior communications were received at the registered email, and the order-in-original is served only by speed post (not email), the proper remedy is through the appellate authority after proper service.
- Recovery notices issued prior to effective service of the order-in-original are liable to be set aside.
- Advocates should ensure their clients receive signed copies (preferably both by registered email and speed post) before any recovery action and should promptly advise appellate remedies once served.
Summary of Legal Reasoning
- The Court considered the petitioner’s assertion of non-service of the order-in-original contrasted against the respondent’s evidence of previous communications successfully delivered by email and the actual service of the disputed order by speed post.
- Noting the dispute over whether service by speed post alone constituted valid service, the Court declined to resolve such factual issues in writ proceedings.
- Instead, the Court directed the respondent authorities to serve a signed copy of the order-in-original upon the petitioner within one week, thereby guaranteeing access to the appellate mechanism as explicitly provided under the Finance Act, 1994 read with the CGST Act, 2017.
- The demand notices (recovery notices) based on the disputed order-in-original were set aside until the petitioner had a fair opportunity to appeal.
- The judgment thus affirms the principle that writ courts should not conduct fact-finding where statutory remedies exist and that procedural fairness (due service) is paramount before tax recovery.
Arguments by the Parties
Petitioner
- Asserted that the order-in-original was not served upon petitioner no.1.
- Contended that recovery notices issued prior to service of the order-in-original are unsustainable.
Respondents (CGST authority)
- Demonstrated that all prior notices (show cause and hearing notices) were sent via email to the registered email ID.
- Argued that order-in-original was also served through speed post, and petitioner no.1 had access to previous communications.
Factual Background
- The petitioners were subject to two recovery notices dated 26th February 2025 and 30th May 2025 based on an order-in-original dated 28th June 2024.
- Petitioners claimed the order-in-original was not served on them, although previous show cause and hearing notices had been received via email; the order-in-original was served only by speed post.
- Dispute centered on the validity and sufficiency of the mode of service, leading to the filing of a writ petition.
Statutory Analysis
- The Court referenced the show cause notice issued under Section 73(1), Section 75, Section 78, and Section 70 of the Finance Act, 1994 read with Section 174 of the CGST Act, 2017.
- The judgment focused on procedural requirements for service of the order-in-original and the availability of an appellate remedy under the Finance Act, 1994.
- No explicit statutory interpretation or reading down was conducted; rather, the decision centered on procedural compliance and statutory appellate rights.
Procedural Innovations
- The Court set a precedent for disposition in service-related disputes: ordering expedited service of the disputed order and setting aside recovery notices pending the exercise of appellate remedy.
- Directions issued for the authorities to serve a signed copy of the order-in-original within a fixed period, and timeline provided for the petitioner to file an appeal thereafter.
Alert Indicators
- ✔ Precedent Followed – Existing procedural law on contested questions of fact and writ jurisdiction affirmed.