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2024 (6) TMI 163 - HC - GSTViolation of principles of natural justice - ex-parte demand order u/s 73 of SGST Act - denial of opportunity of oral hearing before Assessing Authority - 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. It has to be ensured that such opportunity is granted in real terms - the impugned order itself has been passed on 30.12.2023, while reply to the show-cause-notice had been entertained on 30.09.2023. 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. 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 impugned order dated 30.12.2023 is set aside. The matter is remitted to the respondent no.2/Assistant Commissioner, State Tax, Sector-2, Pratapgarh, Uttar Pradesh to issue a fresh notice to the petitioner within a period of two weeks from today - petition allowed by way of remand.
Issues involved: Challenge to ex-parte demand order u/s 73 of State Goods & Service Tax Act and denial of opportunity of oral hearing before Assessing Authority.
Challenge to ex-parte demand order: The petitioner filed a writ petition seeking to quash the ex-parte demand order dated 30.12.2023 issued by the Assistant Commissioner, State Tax, Sector-2, Pratapgarh, Uttar Pradesh u/s 73 of the State Goods & Service Tax Act. The order raised a demand in excess of Rs. 71,39,146 against the petitioner. The main ground raised was the denial of opportunity of oral hearing before the Assessing Authority, as the petitioner was not given a chance for personal hearing as required by law. Denial of opportunity of oral hearing: The petitioner argued that the Assessing Authority failed to provide an opportunity of personal hearing before passing the adverse assessment order, which is a 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 case to support the claim that the opportunity of hearing must be granted before passing an adverse order. On the other hand, the revenue's counsel contended that the petitioner had declined the opportunity of hearing by selecting 'No' in the online reply to the show-cause notice. Court's Decision: The Court agreed with the petitioner's argument that the Assessing Authority was obligated to provide an opportunity of personal hearing before passing an adverse order, regardless of the petitioner's initial choice in the online reply. The Court emphasized the importance of providing a genuine opportunity of hearing in cases involving heavy civil liabilities to ensure the principles of natural justice are upheld. The impugned order dated 30.12.2023 was set aside, and the matter was remitted to the Assistant Commissioner to issue a fresh notice to the petitioner within two weeks for a fair hearing process.
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