2024 (2) TMI 359 - HC - GST

Reversal of refund earlier granted to the petitioner - not affording any opportunity of hearing - violation of principles of natural justice and provisions of section 75(4) of GST - - maintainability of petition - availability of alternative remedy - HELD THAT - Since the statutorily incorporated right of natural justice has been violated for no good reason, it is observed that alternate remedy that otherwise exists may not operate as a bar to entertain the present petition. Besides the fact that the petitioner has a right of hearing, rule of law also commends that obligation to provide such an opportunity be duly enforced on the revenue authorities as may not give rise to fruitless and wholly avoidable litigation as has arisen in the present petition. The matter is remitted to the respondent no. 3 to pass a fresh order after affording opportunity of hearing to the petitioner - petition allowed.

Summary

Issues Involved:
Challenge to order dated 22.11.2023 passed by Joint Commissioner (Corporate Circle), State Tax, Saharanpur, Headquarter-Muzaffarnagar u/s Rule 142(5) of the Uttar Pradesh Goods and Services Tax Act, 2017 for the period January, 2021, regarding reversal of refund granted to the petitioner.

Comprehensive Details:

1. Violation of Right to Hearing:
The petitioner challenged the order dated 22.11.2023, contending that the revenue authorities denied the refund without affording the petitioner the right to be heard u/s Section 75(4) of the Act, 2017. Despite the petitioner's adjournment request, the revenue authority rejected it on grounds of repeated adjournment sought, leading to the passing of the impugned order. The petitioner argued that the impugned order was passed in complete denial of their statutory right to a hearing.

2. Statutory Remedy of Appeal:
The Revenue's counsel suggested that the petitioner could avail the statutory remedy of appeal against the order. However, it was acknowledged that the petitioner had filed an adjournment application for the initial hearing date of 16.11.2023, which was evident from the record. The impugned order itself acknowledged the filing of the adjournment application by the petitioner but failed to provide any valid reason for its rejection.

3. Observations and Decision:
The Court noted that Section 75(4) of the Act, 2017 grants the petitioner the right to be personally heard before the passing of any adverse order. Due to the violation of this statutorily incorporated right of natural justice, the Court held that the impugned order could not be sustained. The Court emphasized that the obligation to provide a hearing opportunity should be enforced on revenue authorities to prevent unnecessary litigation. As the Revenue's counsel made a fair statement, the Court decided not to impose any costs on the revenue authorities.

4. Judgment and Directions:
Consequently, the writ petition was allowed, and the order dated 22.11.2023 was set aside. The matter was remitted to the respondent no. 3 to pass a fresh order after providing a proper opportunity of hearing to the petitioner. The petitioner was directed to file a detailed reply to the show cause notice within two weeks. The authority was instructed to fix a hearing date with at least 15 days notice in advance and pass an appropriate order expeditiously, preferably within one month from the date of hearing.