2024 (12) TMI 930 - HC - GST

Challenge to Order-in-Appeal and the rectification order passed by respondent No. 2 i.e. the Commissioner (Appeals-II) - no notice was given before dismissing the appeal - violation of principles of natural justice - HELD THAT - Admittedly, there is no dispute that the respondent No. 2 Commissioner (Appeals-II) did not give any opportunity of hearing to the petitioner for seeking their say on the three grounds on which the main appeal came to be dismissed, that is non-payment of pre-deposit, application for condonation of delay and board resolution of authorised person. Even the order rejecting the application came to be passed without hearing the petitioner. The appellate authority ought to have put to the petitioner the grounds on which he proposed to dismiss the appeal, namely pre-deposit, board resolution and condonation of delay and ought to have given opportunity to the petitioner to put their say and satisfy the appellate authority. There were procedural requirements which could not come in the way of seeking substantial justice. Respondent No. 2 will give the petitioner personal hearing stating grounds of deficiency and give adequate opportunity to the petitioner to rectify the same or to satisfy that no such grounds exists. Respondent No. 2, should thereafter hear the petitioner on merits and pass speaking order. Appeal disposed off.

Summary

Issues:
Challenge to Order-in-Appeal and Rectification Order under Article 226 of the Constitution of India; Lack of opportunity of hearing before dismissal of appeal; Procedural requirements for seeking substantial justice.

Analysis:
The petitioner, engaged in banking business under the CGST Act, challenged the Order-in-Appeal and rectification order passed by the Commissioner (Appeals-II). The petitioner faced technical glitches in filing the appeal due to non-uploading of the original order on the portal. Despite physical and electronic filing of the appeal, it was dismissed on grounds of non-payment of pre-deposit, lack of application for condonation of delay, and absence of board resolution authorizing the appeal. The petitioner's rectification application was also dismissed without a hearing, prompting the challenge before the court.

The High Court noted that the appellate authority failed to provide the petitioner with an opportunity to address the grounds for dismissal, violating principles of natural justice. Citing a previous case, the court quashed the Order-in-Appeal and rectification order, emphasizing that procedural requirements should not hinder substantial justice. The court directed the respondent to grant the petitioner a personal hearing, specify deficiencies, allow rectification, and provide a chance to present arguments on merits for a speaking order.

The judgment concluded by keeping all rights and contentions open, clarifying that no observation was made on the merits of the case. The rule was disposed of without any cost order, ensuring that the petitioner receives a fair opportunity to present their case and rectify any procedural shortcomings.