2022 (4) TMI 915 - HC - GST

Maintainability of petition - opportunity of hearing not provided - violation of principles of natural justice - ex-patre order - HELD THAT - This Court, notwithstanding the statutory remedy, is not precluded from interfering where, ex facie, we form an opinion that the order is bad in law. This is for two reasons - (a) violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case; (b) order passed ex parte in nature, does not assign any sufficient reasons even decipherable from the record, as to how the officer could determine the amount due and payable by the assessee. The order, ex parte in nature, passed in violation of the principles of natural justice, entails civil consequences.

Summary

Issues:
Petition to quash show cause notice, order, and demand order based on violation of natural justice principles and lack of reasons provided.

Analysis:
The petitioner sought relief to quash various orders, including a show cause notice, an ex parte order, a summary of order, and a demand order issued by the Assistant Commissioner of State Tax. The orders were challenged on the grounds of being ex parte in nature and lacking sufficient reasoning and natural justice principles.

The Revenue's counsel expressed willingness for the matter to be remanded for a fresh decision by the Assessing Authority, ensuring a fair consideration on merits without coercive actions during the proceedings. The court accepted this statement and recorded it accordingly.

Despite the statutory remedy available, the court found it within its jurisdiction to intervene when an order is prima facie flawed in law. The court highlighted two main reasons for its intervention: first, the violation of natural justice principles by not providing adequate time for the petitioner to present their case, and second, the ex parte order lacking clear reasons for determining the tax amount due. Such orders, passed in violation of natural justice, have civil consequences.

Consequently, the court disposed of the petition by quashing the impugned orders and directing specific actions for the petitioner, including deposit requirements, de-freezing of bank accounts, and appearing before the Assessing Authority. The court emphasized compliance with natural justice principles, affording opportunities for all parties to present essential documents, and ensuring a speaking order with reasons provided.

The court reserved liberty for the petitioner to challenge the order if necessary, and for parties to seek other available remedies in accordance with the law. While refraining from expressing any opinion on merits, the court left all issues open for further consideration. The court also encouraged digital proceedings during the pandemic and expected timely handling of any future remedies according to the law. Finally, the court disposed of the petition and related applications, with the respondents instructed to communicate the order electronically to the appropriate authority.