2025 (1) TMI 106 - HC - GST

Violation of principles of natural justice - service of SCN - petitioner was never afforded any opportunity of personal hearing - HELD THAT - Upon service of notice, the petitioner had been called to file its reply only. Consequently, non-compliance of that show cause notice may have only led to closure of opportunity to submit written reply. However by virtue of the express provision of Section 75 of the Act, even in that situation the petitioner did not lose its right to participate at oral hearing and establish at that stage itself that the adverse conclusions proposed to be drawn against the petitioner, may be dropped. The rules of natural justice as are ingrained in the statute prescribe dual requirement. First with respect to submission of written reply and the second with respect to oral hearing. Failure to avail one opportunity may not lead to denial of the other. The two tests have to be satisfied independently. Thus, no useful purpose may be served in keeping this petition pending or calling counter affidavit at this stage or to relegate the present petitioner to the forum of alternative remedy. The order impugned has been passed contrary to the mandatory procedure. The deficiency of procedure is self apparent and critical to the out-come of the proceedings. Matter is remitted to the respondent No. 2 to pass a fresh order - petition allowed by way of remand.

Summary

The High Court of Allahabad, presided by Hon'ble Anjani Kumar Mishra, J. and Hon'ble Jayant Banerji, J., addressed a petition concerning procedural deficiencies under the U.P. G.S.T. Act, 2017. The petitioner, represented by Mr. Pranjal Shukla, contended that the notice issued under Section 73(1) of the Act failed to grant the mandatory "opportunity of personal hearing" as required by Section 75(4). The notice specified "NA" for the date, time, and venue of personal hearing, indicating non-compliance with statutory requirements.

The court emphasized that the Act mandates dual requirements: submission of a written reply and the opportunity for oral hearing, both integral to the rules of natural justice. The failure to provide a personal hearing violated these principles, as the petitioner could not clarify discrepancies noted by the adjudicating authority without it.

The court concluded that the procedural deficiency was critical to the outcome, rendering the impugned order dated 29.04.2024 invalid. Consequently, the order was set aside, and the matter was remitted to the respondent for a fresh decision. The petitioner was allowed to submit a final reply within two weeks and appear before the assessing authority for a reasoned order. The writ petition was allowed.