2020 (7) TMI 444 - HC - GST

Principles of Natural Justice - validity of impugned order dated 22.05.2020 passed by the authority under Section 74 of the Goods and Service Tax Act, 2017 - grievance of the writ applicant is that the impugned order dated 22.05.2020 came to be passed without giving any opportunity of hearing to the writ applicant - the order came to be passed during the period of complete lock-down. HELD THAT - The Department has agreed to give an opportunity of hearing to the writ applicant and thereafter pass an appropriate fresh order - the impugned order dated 22.05.2020 is hereby quashed and set aside. The matter is remitted to the respondent No.2 for giving an opportunity of hearing to the writ applicant and thereafter pass appropriate order in accordance with law - Application allowed by way of remand.

Summary

Issues:
Challenge to order passed under Section 74 of the Goods and Service Tax Act, 2017 without opportunity of hearing during lockdown period.

Analysis:
The writ applicant, a Proprietor of a Proprietary concern engaged in the business of iron and scrap, filed a writ application under Article 226 of the Constitution of India seeking various reliefs, including quashing of an order passed under Section 74 of the GST Act without following due process. The applicant contended that the order was passed during the lockdown period without providing an opportunity of hearing. The main contention was the violation of the principle of natural justice due to the lack of a hearing before passing the order.

The High Court, after considering the facts, noted that the impugned order was passed without giving any opportunity of hearing to the writ applicant. The Court observed that the order was issued during a complete lockdown period, raising concerns about procedural fairness. The counsel for the writ applicant requested the quashing of the order and a remittance of the matter to the concerned authority for providing an opportunity of hearing to the applicant.

During the hearing, the Department agreed to give the writ applicant an opportunity of hearing and to pass a fresh order accordingly. Consequently, the High Court quashed and set aside the impugned order dated 22.05.2020. The matter was remitted to the concerned authority for affording the writ applicant a proper hearing and passing an appropriate order in accordance with the law. The Court granted the applicant eight weeks to appear before the authority for the hearing. It was further clarified that the Court did not delve into the merits of the case but focused on procedural fairness and the right to a hearing.

In conclusion, the High Court allowed the writ application, emphasizing the importance of adhering to principles of natural justice and providing an opportunity of hearing before passing orders, especially during extraordinary circumstances like a lockdown. The Court's decision to quash the order and remit the matter for a fresh decision after a proper hearing reflects the significance of procedural fairness in administrative actions under the GST Act.