2023 (11) TMI 1123 - HC - VAT and Sales Tax

Violation of principles of natural justice - petitioner was not given a fare and reasonable opportunity to defend his case - HELD THAT - All the notices which were issued to the petitioner went unserved. Which apparently establishes the fact that the petitioner had never received any communication for replying to the show cause notice issued or for that matter, the notice of personal hearing is concerned. Another aspect which needs to be considered is that, according to the petitioner, the establishment stood closed as an impact of COVID-19 pandemic. In addition, it was also seized by the bank authorities on account of the default on the part of the landlord in repayment of loan availed, which further gave rise to the petitioner not being available at the concerned address where notices were issued - Even on 23.06.2023, when the petitioner furnished his reply to the said show cause notice, there was still sufficient time left for the department for concluding the proceedings within a stipulated period of time i.e. till 06.07.2023. Yet the respondents, for the reasons best known, choose not to grant an opportunity of personal hearing to the petitioner and proceeded to decide the matter on merits. When the petitioner had entered appearance on 23.06.2023, in all fairness of the requirement of law, the respondent No. 2 could have called upon the petitioner to make his representation by way of a personal hearing and thereafter could have proceeded to decide the case on its own merits. In the absence of the same, we are having hesitation in holding that it would be hit by the principles of natural justice and the action on the part of the respondent No. 2 amounts to denial of a fare and reasonable opportunity to the petitioner before an impugned order is passed. The matter stands remitted to the respondent No. 2, the petitioner herein is directed to enter appearance before the respondent No. 2 on 12.09.2023 - Petition disposed off.

Summary

Issues Involved:
The primary contention raised is the violation of principles of natural justice by the Deputy Commissioner. The petitioner claims they were not given a fair opportunity to defend their case.

Judgment Details:
The petitioner challenged the order of the Deputy Commissioner, alleging a lack of natural justice. The petitioner's counsel argued that the petitioner was not given a fair opportunity to defend due to various reasons, including the impact of the COVID-19 pandemic and the seizure of their business premises by bank authorities. The petitioner entered appearance and submitted a response to the show cause notice, requesting a personal hearing, which was rejected by the authorities. The Division Bench observed a denial of personal hearing and granted interim relief to the petitioner.

The respondents contended that the petitioner had sufficient time to respond and should have availed the opportunity earlier. They argued that repeated notices were sent to the petitioner's address, which went unserved, indicating the petitioner's failure to ensure proper communication.

Upon hearing both sides and examining the records, it was found that the petitioner did not receive any communication regarding the show cause notice or personal hearing. The establishment was closed due to the pandemic and seized by bank authorities, leading to the petitioner's unavailability at the address where notices were sent. Despite the petitioner's subsequent appearance and response, the authorities proceeded without granting a personal hearing, which was deemed a denial of natural justice.

The Court held that the actions of the Deputy Commissioner amounted to a denial of a fair opportunity to the petitioner, contravening the principles of natural justice. The impugned order was set aside, and the respondent authorities were directed to provide a notice for a personal hearing before passing a new order.

The matter was remitted to the Deputy Commissioner, with the petitioner instructed to appear on a specified date. No fresh notice was required, and the authorities were to proceed in accordance with the law. The writ petition was disposed of with no costs awarded, and any pending miscellaneous petitions were closed.