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2023 (10) TMI 939 - HC - GSTValidity of demand raised u/s 74 of the GST Act - opportunity of hearing not provided - violation of principles of natural justice. It is alleged that the SCN contains a stipulation, 'NA' in the place of date of hearing which is required to be specified in the show cause notice. HELD THAT - Learned counsel appearing for the Department does not dispute the assertion that issues raised in this writ petition are squarely covered by the adjudication made in MOHINI TRADERS 2023 (6) TMI 531 - ALLAHABAD HIGH COURT , where it was held that The stand of the assessee may remain unclear unless minimal opportunity of hearing is first granted. Only thereafter, the explanation furnished may be rejected and demand created. This petition is disposed off.
Issues Involved:
1. Liability for deposit of GST u/s 74 of The Goods and Services Tax Act. 2. Denial of opportunity of oral hearing before the Assessing Authority. Issue 1: Liability for deposit of GST u/s 74 of The Goods and Services Tax Act The petitioner is aggrieved by the order dated 04.02.2023, whereby liability has been raised for deposit of GST under Section 74 of The Goods and Services Tax Act. The impugned order was passed pursuant to a show cause notice issued under Section 74 of the GST Act on 09.10.2022. The notice lacked a specified date of hearing, which is essential in such cases. The submission is that no opportunity of hearing was given in the matter, rendering the impugned order unsustainable. Issue 2: Denial of opportunity of oral hearing before the Assessing Authority The petitioner contends that they were completely denied an opportunity of oral hearing before the Assessing Authority. The petitioner's counsel argued that as per Section 75(4) of the U.P. GST Act, 2017, the Assessing Authority was obligated to provide an opportunity of personal hearing before passing an adverse assessment order. Relying on precedents and legal interpretations, it was asserted that the absence of a hearing rendered the assessment order, which raised a disputed demand of tax, contrary to established legal principles. The Revenue's counsel argued that the petitioner had declined the opportunity of hearing by selecting 'No' in the reply to the show-cause notice submitted online. However, the Court held that the petitioner's choice to decline a hearing did not absolve the Assessing Authority of its duty to provide such an opportunity as mandated by law. The Court emphasized the importance of providing a genuine opportunity of hearing, especially in cases involving significant civil liabilities. Upholding the principles of natural justice, the Court ruled that authorities must ensure that adequate hearing opportunities are granted before making adverse decisions. This ensures fairness, reasoned decision-making, and facilitates better outcomes at subsequent stages, including appeals. In conclusion, the Court allowed the writ petition, setting aside the impugned order and remitting the matter back to the Assistant Commissioner to issue a fresh notice with a specified date of hearing. The decision was based on the principles established in a similar case, Writ Tax No.551 of 2023, where the petitioner's rights were upheld.
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