2024 (4) TMI 780 - HC - GST

Violation of principles of natural justice - challenge to the ex parte nature of the order - no proper notice to file reply and in any case, no prior notice of hearing was served to the petitioner before the impugned order came to be passed - HELD THAT - While there can be no dispute to the fact that the proceedings conducted by the respondent authorities are wholly irregular and contrary to the provisions of law and ex parte, without issuance of any notice to the petitioner and without communication of any date of hearing fixed in the proceedings, detailed note is made of the order sheet to record the wholly unacceptable conduct of the respondent authority in proceeding in the manner in which he has. Adjudication orders give rise to serious civil consequences. They create demands of tax as also penalties are often imposed. In the self assessment scheme, unless the noticee/assessee is given fair opportunity to furnish its reply and to present his case before the adjudicating authority the adjudication orders may only give rise to frivolous and wholly avoidable litigation contrary to the statutory scheme itself. The impugned order dated 23.02.2024 is set aside - the petitioner may treat the impugned order to be a final show-cause notice and furnish its detailed reply within a period of two weeks from today - the writ petition is disposed off.

Summary

Issues involved: Challenge to adjudication order u/s 73 of the UP GST Act, 2017 read with Rule 142(5) of the Rules framed thereunder due to ex parte nature of the order.

The challenge primarily revolves around the lack of proper notice and absence of prior hearing for the petitioner before the impugned order was passed. The court examined the order sheet and found multiple deficiencies in the proceedings conducted by the respondent authorities. Notably, there were discrepancies in the recording of dates, lack of communication of hearing dates, and irregularities in the conduct of the proceedings. The court emphasized the importance of providing a fair opportunity to the noticee/assessee in adjudication matters to avoid unnecessary litigation and ensure compliance with the statutory scheme.

In light of the irregularities and procedural shortcomings identified, the court set aside the impugned order dated 23.02.2024. The petitioner was directed to treat the order as a final show-cause notice and submit a detailed reply within two weeks. Subsequently, respondent no.2 was instructed to schedule a fresh hearing with proper notice and pass a reasoned order after considering the petitioner's objections. Additionally, the court directed that corrective measures, including appropriate action, be taken by respondent no.3 regarding the conduct of respondent no.2 in the proceedings.