2024 (5) TMI 719 - HC - GST

Violation of principles of natural justice - complete denial of opportunity of oral hearing before the Assessing Authority - petitioner contend that the petitioner was denied opportunity of hearing because he had tick marked the option 'No' against the option for personal hearing (in the reply to the show-cause-notice), submitted through online mode - HELD THAT - There are complete agreement with the view taken by the coordinate bench in BHARAT MINT AND ALLIED CHEMICALS VERSUS COMMISSIONER COMMERCIAL TAX AND 2 OTHERS 2022 (3) TMI 492 - ALLAHABAD HIGH COURT . Once it has been laid down by way of a principle of law that a person/assessee is not required to request for opportunity of personal hearing and it remained mandatory upon the Assessing Authority to afford such opportunity before passing an adverse order, the fact that the petitioner may have signified 'No' in the column meant to mark the assessee's choice to avail personal hearing, would bear no legal consequence. Even otherwise in the context of an assessment order creating heavy civil liability, observing such minimal opportunity of hearing is a must. Principle of natural justice would commend to this Court to bind the authorities to always ensure to provide such opportunity of hearing - Not only such opportunity would ensure observance of rules of natural of justice but it would allow the authority to pass appropriate and reasoned order as may serve the interest of justice and allow a better appreciation to arise at the next/appeal stage, if required. The matter is remitted to the respondent no.2/Assistant Commissioner, Sector-2, Pratapgarh, Prayagraj who may issue a fresh notice to the petitioner within a period of two weeks from today - petition allowed by way of remand.

Summary

Issues involved:
The judgment deals with the challenge raised against the order passed by the Assistant Commissioner for the tax period 2019-20, where a demand in excess of Rs. 4,37,156.6/- was raised against the petitioner. The main issue revolves around the denial of opportunity of oral hearing before the Assessing Authority, as claimed by the petitioner.

Details of the Judgment:
The petitioner contended that he was completely denied the opportunity of oral hearing before the Assessing Authority, which is in violation of Section 75(4) of the U.P. GST Act, 2017. The petitioner relied on a previous court decision and a Gujarat High Court decision to support the argument that the Assessing Authority was required to provide an opportunity of personal hearing before passing an adverse assessment order.

The counsel for the revenue argued that the petitioner was denied the opportunity of hearing because he had declined it by selecting 'No' in the reply to the show-cause-notice submitted online. However, the court emphasized that the petitioner's choice to decline the opportunity of hearing should not negate the mandatory requirement for the Assessing Authority to provide such an opportunity before passing an adverse order.

The court, after considering the arguments from both sides and examining the relevant legal provisions, agreed with the view taken in a previous case that the Assessing Authority must afford the opportunity of personal hearing before making an adverse decision. The court highlighted the importance of providing a genuine opportunity of hearing, especially in cases involving heavy civil liability, to ensure the principles of natural justice are upheld.

In conclusion, the court allowed the writ petition, set aside the impugned order, and remitted the matter back to the Assistant Commissioner. The Assistant Commissioner was directed to issue a fresh notice to the petitioner within two weeks, and the petitioner was instructed to appear before the authority for further proceedings to be conducted promptly.