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2024 (3) TMI 739 - AAAR - GSTViolation of principles of natural justice - failure to share documents and comments forwarded by DGGI, with the appellants - Rejection of application for Advance Ruling - Levy of GST - various fees collected by Tamil Nadu Medical Council, a Government Authority - HELD THAT - The rejection of application for advance ruling in the instant case stems from the fact that an investigation initiated by DGGI against the appellant is pending on the same issue. This being the case, the advance ruling authority ought to have shared the new findings of DGGI that was lying before them, and discussed the same in detail, either during the personal hearing, or thereafter, before proceeding to finalise the case. The principles of natural justice have not been followed in the instant case since the advance ruling authority had erred in not sharing the documents and comments forwarded by DGGI, with the appellants - the ends of justice will be met by restoring the application for advance ruling to its original position, by way of remanding the case to the lower authority, with a direction to forward the letter dated 03.04.2023 of DGGI alongwith its enclosures, if any, to the appellant enabling them to comment on the same, and to offer them another opportunity of personal hearing before deciding the case as per the provisions of law. The matter is remanded to the Lower Authority for consideration and passing of appropriate orders, after following the principles of natural justice.
Issues Involved:
1. Whether summons under Section 70 of CGST Act constitute "proceedings." 2. Whether the principles of natural justice were followed. 3. Admissibility of the application for advance ruling filed by the appellant. Summary: Issue 1: Whether summons under Section 70 of CGST Act constitute "proceedings." The appellant, Tamil Nadu Medical Council, filed an appeal against the order rejecting their application for advance ruling on the applicability of GST on various fees collected. The original authority rejected the application under the first proviso to Section 98(2) of the CGST Act, 2017, on the grounds that summons issued under Section 70 is a proceeding. The appellant contended that an investigation or inquiry does not constitute "proceedings" unless it results in a Show Cause Notice (SCN) or order. They cited various judgments, including those of the Supreme Court and High Courts, to support their argument that "proceedings" should include only actions that may result in a decision, such as a show cause notice or order. Issue 2: Whether the principles of natural justice were followed. The appellant argued that the additional material submitted by the DGGI to the Advance Ruling Authority was not disclosed to them, thereby violating the principles of natural justice. They were not given an opportunity to comment on the submissions of DGGI regarding the Andhra Pradesh High Court order dated 23.11.2022. The Appellate Authority observed that the rejection of the application stemmed from the investigation initiated by DGGI, and the advance ruling authority should have shared the new findings with the appellant before finalizing the case. Issue 3: Admissibility of the application for advance ruling filed by the appellant. The Appellate Authority noted that the original order did not follow the principles of natural justice as the appellant was not provided with the materials and facts furnished by DGGI. The authority concluded that justice would be served by remanding the case to the lower authority, directing them to forward the letter dated 03.04.2023 from DGGI along with its enclosures to the appellant, allowing them to comment and offering another opportunity for a personal hearing. Order: The Advance Ruling No. 18/ARA/2023 dated 19.06.2023 is set aside. The matter is remanded to the Lower Authority for reconsideration and passing of appropriate orders, following the principles of natural justice.
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