2022 (12) TMI 1451 - HC - GST

Principles of Natural Justice - ex-parte order - fair opportunity of hearing not provided - SCN not issued - HELD THAT - This Court notwithstanding the statutory remedy is not precluded from interfering where ex facie it is opined that the order is bad in law. This is for two reasons- (a) violation of principles of natural justice i.e. fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case; (b) order passed ex parte in nature does not assign any reasons sufficient even decipherable from the record as to how the officer could determine the amount due and payable by the assessee. The order ex parte in nature passed in violation of the principles of natural justice entails civil consequences. The impugned order set aside - petition disposed off.

Summary

Issues:
1. Quashing of Assessment Orders under Section 62 of Bihar Goods & Service Tax Act, 2017 for non-filing of GSTR-3B returns without issuance of show cause notice.
2. Affording an opportunity of hearing before passing impugned assessment orders imposing penalty and interest.
3. Recovery of impugned demand during the pendency of the writ petition.
4. Violation of principles of natural justice in passing ex parte orders without assigning reasons.
5. Interference by the Court despite statutory remedy.
6. Disposal of the writ petition on mutually agreeable terms.

Analysis:
1. The petitioner sought relief for quashing Assessment Orders under Section 62 of the Bihar Goods & Service Tax Act, 2017 due to non-filing of GSTR-3B returns without issuance of show cause notice. The Court found the orders ex parte in nature and lacking in assigning reasons decipherable from the record. The Court emphasized the importance of fair opportunity of hearing and disposed of the petition by quashing the impugned orders.

2. The issue of affording an opportunity of hearing before passing impugned assessment orders imposing penalty and interest was raised. The Court noted the violation of principles of natural justice due to insufficient time given to the petitioner to represent their case. The Court, despite the statutory remedy, decided to interfere as the order was deemed bad in law, disposing of the petition on mutually agreeable terms.

3. Regarding the recovery of the impugned demand during the pendency of the writ petition, the Court directed that no coercive steps shall be taken against the petitioner while the case is pending. This decision was made to ensure fairness and adherence to principles of natural justice.

4. The Court addressed the issue of violation of principles of natural justice in passing ex parte orders without assigning reasons. It was highlighted that such orders have civil consequences and must be supported by adequate reasoning. The Court intervened to set aside the impugned orders and ensure that the petitioner's rights were protected.

5. Despite the availability of a statutory remedy, the Court decided to interfere where it found the order to be bad in law, emphasizing the importance of natural justice and fair opportunity of hearing. The Court's decision to quash the impugned orders showcased its commitment to upholding legal principles and ensuring a just outcome.

6. The writ petition was disposed of on mutually agreeable terms, with the Court outlining specific actions to be taken by the parties involved. These terms included the quashing of orders, deposit of a percentage of the demand raised, de-freezing of bank accounts, appearance before the Assessing Authority, and a directive for the Authority to decide the case on merits while complying with principles of natural justice. The Court reserved liberty for the parties to challenge the order and emphasized the need for expeditious resolution of the case.