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2024 (8) TMI 1091 - HC - GSTMaintainability of petition - availability of alternative remedy - Violation of principles of natural justice - Exemption from IGST in view of Sr.No.144 of N/N. 2/2017 Integrated Tax (Rate) dated 28.06.2017 - seeking declaration that the Brooms sticks imported by the petitioner which are made out of Cocos Nucifera and Nypha Fruitcane - HELD THAT - The fact remains that the impugned order-in-original is passed in the fragrant breach of principles of natural justice by not granting any opportunity of hearing to the petitioner and even the reply submitted by the petitioner is not considered and it is stated that no reply is filed, though the petitioner has tendered the reply in response to the show-cause notice on 11.06.2020. Without entering into the merits of the matter, the impugned Order-In-Original dated 31.12.2020 is hereby quashed and set aside and the matter is remanded back to the adjudicating authority who shall pass a fresh de novo order after giving an opportunity of hearing to the petitioner and the petitioner shall be at liberty to raise all the contentions which are raised in this petition - Petition disposed off by way of remand.
Issues:
1. Interpretation of IGST exemption notifications for imported broomsticks. 2. Breach of principles of natural justice in passing the Order-In-Original. 3. Availability of alternative remedy for challenging the impugned order. Analysis: 1. The petitioner sought relief under Article 227 for exemption of imported broomsticks from IGST under specific notifications. The petitioner argued that broomsticks made from coconut leaves fall under the exemption criteria mentioned in the notifications. The Central Government's power to grant tax exemptions under Section 6 of the IGST Act was highlighted, along with amendments to the notifications affecting the IGST rate on broomsticks. The petitioner contended that their broomsticks should not be subject to the 5% IGST levy imposed by the impugned Order-In-Original dated 31.12.2020 for the specified period. 2. The petitioner raised concerns about the breach of natural justice principles in the adjudication process. It was argued that the adjudicating authority did not consider the petitioner's response to the show-cause notice, and the petitioner could not attend the hearing due to the COVID-19 pandemic. The petitioner also pointed out inconsistencies in the application of IGST rates post-December 2018, emphasizing that their broomsticks were not explicitly covered for IGST levy or exemption. The petitioner asserted that their broomsticks, being made of vegetable material as per the notifications, should not have been subjected to the 5% IGST rate from January 2019 onwards. 3. On the other hand, the respondent contended that the petitioner had an alternative remedy available through an appeal to challenge the impugned Order-In-Original. While acknowledging the petitioner's reliance on a specific notification for exemption, the respondent argued that the broomsticks imported by the petitioner were correctly subjected to the 5% IGST rate under entry no. 260. Despite this, both parties agreed that the impugned order violated principles of natural justice by not providing a fair hearing and disregarding the petitioner's response to the show-cause notice. In conclusion, the High Court quashed the impugned Order-In-Original dated 31.12.2020 due to the breach of natural justice principles and remanded the matter back to the adjudicating authority for a fresh decision. The Court directed the authority to conduct a new hearing, allowing the petitioner to present all contentions raised in the petition within twelve weeks. The petition was disposed of, with notice discharged.
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