2023 (3) TMI 526 - HC - GST

Maintainability of petition - availability of alternative remedy - appeal rejected on the ground of non-filing of the certified copy of the essential documents - opportunity of hearing not provided - ex-parte order - violation of principles of natural justice. 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 we say so, 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; (c) Also the authorities not to have adjudicated the matter on the attending facts and circumstances. All issues of fact and law ought to have been dealt with, even if the proceedings were ex parte in nature. The writ petition is disposed off.

Issues:
1. Quashing of Letters/demand Notices dated 16.08.2021
2. Declaration regarding sections of CGST and BGST Act
3. Remand of the case to the Assessing Authority
4. Violation of principles of natural justice in the order passed
5. Setting aside of impugned orders
6. Deposits required for hearing the appeal
7. De-freezing/de-attaching of bank accounts
8. Directions for future proceedings before the Assessing Authority

Quashing of Letters/demand Notices dated 16.08.2021:
The petitioner sought relief for quashing the Letters/demand Notices dated 16.08.2021, claiming them to be illegal, arbitrary, and beyond jurisdiction. The impugned order passed in Appeal Case was rejected due to non-filing of essential documents. The Court observed a violation of principles of natural justice as the petitioner was not given sufficient time to present their case. The order was deemed ex parte and lacked clear reasons for determining the amount due. The Court decided to quash the impugned orders and directed the case to be decided afresh by the Assessing Authority, emphasizing the importance of fair hearing and addressing all factual and legal aspects.

Declaration regarding sections of CGST and BGST Act:
The petitioner sought declarations on various sections of the CGST and BGST Act, challenging the denial of input tax credit and the procedural conditions prescribed. The Court held that the conditions under section 16(4) were procedural and could not override substantive conditions. It emphasized the non obstante clause in section 16(2) prevailing over section 16(4). Additionally, the Court ruled that GSTR-3B could not be considered a return as prescribed under section 39(1) of the CGST Act. These declarations were crucial in interpreting the applicability of input tax credit and procedural requirements under the Acts.

Remand of the case to the Assessing Authority:
The Court, despite the statutory remedy, intervened due to the order's legal flaws, including the violation of natural justice principles and lack of clear reasoning. It directed the case to be remanded to the Assessing Authority for a fresh decision, ensuring fair hearing, no coercive steps during the case, and addressing all issues of fact and law. The Court emphasized the importance of adjudicating the matter on merits and affording all parties the opportunity to present essential documents and materials.

Setting aside of impugned orders:
The Court quashed the impugned orders passed by the Additional Commissioner of State Taxes and the Assistant Commissioner of State Taxes, citing procedural irregularities, lack of fair hearing, and insufficient reasoning. The decision aimed to rectify the legal flaws in the previous orders and ensure a fair and just resolution of the case.

Deposits required for hearing the appeal:
The petitioner was required to deposit a certain percentage of the total amount as a condition for hearing the appeal. The Court accepted the petitioner's statement regarding the deposit and directed additional deposits to be made within a specified period. These deposits were deemed necessary for the appeal process and were subject to the Assessing Officer's final decision, with provisions for refund if found in excess.

De-freezing/de-attaching of bank accounts:
The Court directed the de-freezing/de-attaching of the petitioner's bank accounts, if attached in reference to the proceedings, to be done immediately. This step aimed to alleviate any financial constraints on the petitioner during the legal proceedings and ensure a fair resolution of the case without undue financial burdens.

Directions for future proceedings before the Assessing Authority:
Various directions were issued for the future proceedings before the Assessing Authority, emphasizing the principles of natural justice, fair hearing, cooperation of all parties, expeditious decision-making, and the provision of speaking orders with reasons. The Court reserved liberty for the petitioner to challenge the order if required and for parties to explore other legal remedies. The judgment aimed to ensure a just and efficient resolution of the case while upholding legal principles and procedural fairness.

← Previous Next →