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TMI Blog2024 (4) TMI 1031X X X X Extracts X X X X X X X X Extracts X X X X ..... ply is subsequently filed. This is not the intent of provisions of sub-Sections (4) and (5) of Section 75. The Supreme Court has in number of occasion has held that the opportunity of hearing means granting real and meaningful opportunity and adequate time must given to prepare and present the defence - Supreme Court in UMA NATH PANDEY VERSUS STATE OF UP. [ 2009 (3) TMI 526 - SUPREME COURT] has observed Time given for the purpose should be adequate so as to enable him to make his representation. In the absence of a notice of the kind and such reasonable opportunity, the order passed becomes wholly vitiated. Thus, it is but essential that a party should be put on notice of the case before any adverse order is passed against him. It is one of the established principles of Common Law that officials taking action of a judicial nature must give an adequate opportunity of being heard to a person against whom the action is proposed to be taken. In the given case without filing the reply, it cannot be understood how personal hearing can be justified. When the assessee is burdened with a tax liability, then the intent and the object of the statute are strictly to be complied with. Prima Fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant, the last date for reply was fixed on 30.10.2023 and the appellant sought for extension of such time by Annexure-P/10 on 11.10.2023, i.e. reply within the prescribed timeline. 3. The submission of the appellant is that before the filing of the reply since date of personal hearing was fixed, under those circumstances, the extension of time was sought for. However, eventually, the order dated 29.12.2023 was passed. It is contended on behalf of the appellant that in a manner of this nature, before imposition of liability, sub-section 9 of Section 73 contemplates that the officer shall after considering the representation shall issue the order and Section 75 (4) mandates that opportunity of hearing shall be granted if the sufficient cause is shown and where any adverse decision is contemplated against the assessee. It is submitted that adverse order has been passed without giving any opportunity of hearing to the appellant, therefore, the rules of natural justice were defeated. The counsel placed his reliance on the decision of the Supreme Court in the matter of Kalpraj Dharamshi and another v. Kotak Investment Advisors Limited reported in 2021 10 SCC 401 and submits that in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the proper officer that any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised for any reason, other than the reason of fraud or any wilful-misstatement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or utilised input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under section 50 and a penalty leviable under the provisions of this Act or the rules made thereunder. 8. Reading of this Section would show that the revenue would be within its power to issue the notice, that when tax has not been paid or short paid or erroneously refunded or some input tax credit has been wrongly availed or utilized other than a reason of fraud or willful misstatement, the notice would be under Section 73 sub-section (10) of CGST Act, as the limitation has been imposed of three years, while in cases of fraud it is covered under Section 74 wherein the limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eable with tax, grant time to the said person and adjourn the hearing for reasons to be recorded in writing: Provided that no such adjournment shall be granted for more than three times to a person during the proceedings. (6) xxx 12. The submission of the State/Revenue is that as per Section 75 sub-Section 4 of the CGST Act, the date of hearing was already given on 11.10.2023 and 25.10.2023, therefore, the mandate of Section 75 (4) stands complied. We are not in agreement to that submission as the opportunity of hearing when is contemplated under the statute, it has to be comprehensive and it cannot be short-circuited. The show cause notice reflects that the date of reply was given on 30.10.2023 and before the personal hearing date is given, it would be about a superfluous and would defeat the actual intent of the legislation of giving an opportunity of hearing. It is not expected that before the reply is filed, an assessee can be heard and thereafter the reply is filed. It is against the normal procedure and is against the normal practice of the parties that personal hearing is preponed and the reply is subsequently filed. This is not the intent of provisions of sub-Sections (4) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is recognized as an important aspect of adjudication not only in India but across several jurisdictions. The Supreme Court in Automotive Tyre Manufacturers Assn. v. Designated Authority, (2011) 2 SCC 258 : 2011 SCC OnLine SC 130 at page 296 83. The procedure prescribed in the 1995 Rules imposes a duty on the DA to afford to all the parties, who have filed objections and adduced evidence, a personal hearing before taking a final decision in the matter. Even written arguments are no substitute for an oral hearing. A personal hearing enables the authority concerned to watch the demeanour of the witnesses, etc. and also clear up his doubts during the course of the arguments. Moreover, it was also observed in Gullapalli [AIR 1959 SC 308] , if one person hears and other decides, then personal hearing becomes an empty formality. The Supreme Court in United States Jack R. GOLDBERG, Commissioner of Social Services of the City of New York vs. John KELLY et al. (23.03.1970 - USSC) : MANU/USSC/0168/1970 held that The opportunity to be heard must be tailored to the capacities and circumstances of those who are to be heard. It is not enough that a welfare recipient may present his position to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated 29.12.2023 was passed. The Supreme Court in Kalpraj Dharamshi and another (supra) has held that when the principles of natural justice has not been followed, the litigant would be entitled to invoke the jurisdiction of High Court under Article 226 of the Constitution of India. For the sake of brevity, Para 75 is relevant here and quoted below: 75. It has been clearly held, that when the proceedings invoked before a statutory authority are dehors the jurisdiction or when they are in breach of principles of natural justice, the party would be entitled to invoke the jurisdiction of the High Court under Article 226 of the Constitution. 17. Therefore, in our considered view, we are not in agreement with the orders passed by the learned Single Bench and set aside the same. 18. Now coming back to the hearing, the judgments which has been relied on by counsel for the appellant i.e. Fino Paytech Limited (supra) and MS KEC International Limited (supra), also fall in the same line wherein, the High Courts have repeatedly held that when the statute contains a mandate of hearing which is synonym to natural justice, it cannot be given a go bye or can be made porous, therefore, the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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