In a recent case, the Calcutta High Court set aside an order of the Goods and Service Tax ( GST ) and held that the Appellate Authority under CGST Act cannot suo motu enhance tax liability on an assessee, without following the procedure under Section 107(11) of the CGST/ WBGST Act. The tax initially quantified on the appellant assessee Hriday Kumar Das by the assessing officer was Rs.2,58,536.80.

However, while imposing the penalty, the assessing officer imposed a penalty on the sum of Rs.41,83,804.72. This order was put to challenge by filing a statutory appeal. The Appellate Authority however, suo-motu enhanced the tax liability on the assessee, who then approached the High Court. Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here A single bench of the High Court stayed the order of appellate authority, subject to payment of 10% of disputed tax.Section 107 of the Act prescribes procedure for filing and adjudication of appeals by the Appellate Authority.

Sub-section 11 thereof stipulates that the Appellate Authority can confirm, modify or annul the order appealed against, provided that an order enhancing any fee/ penalty/ fine shall not be passed unless the appellant is given a reasonable opportunity of hearing. At the outset, the division bench of Chief Justice T. S. Sivagnanam and Justice Bivas Pattanayak observed that the order passed by the appellate authority, to the extent it suo motu enhanced tax liability, “is not tenable in law”. While allowing the appeal, the court set aside the orders passed by the appellate authority as well as the adjudicating authority and remanded the matter back for fresh consideration, in light of some subsequent events. Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here Advocates Himangshu Kumar Ray, Shiwani Shaw, Subhasis Podder, Amit Saha and Piyas Chowdhury appeared  for Appellant. Advocates T.M. Siddiqui, T. Chakraborty and S. Sanyal appeared for State.