2020 (8) TMI 626 - HC - GST

Court quashes GST order, mandates fair process for reconsideration.

BEAUTY MARK GOLD MANUFACTURES PVT. LTD Versus STATE TAX OFFICER [1B] STATE GST DEPT.

The Court allowed the writ petition, quashed the Ext.P11 order under the GST Act, and directed the respondent to reconsider the matter. The respondent was ... Principles of Natural Justice - it is the case of the petitioner that before passing Ext.P11 order he was not afforded an adequate opportunity of hearing or an opportunity to respond to the show cause notice, which is mandated as per the Rules - HELD THAT:- The learned Government Pleader would submit, on instructions, that it is a fact that there was no proper hearing afforded to the petitioner pursuant to the issuance of a show cause notice as mandated under the Rules, and the officer is ready to reconsider the matter, after providing an opportunity to the petitioner to take copies of the documents sought to be relied against it in the proceedings, as also to consider any reasonable request for cross examination of persons. The respondent are directed to pass fresh orders in the matter after hearing the petitioner as mandated under Section 74(1) of the SGST Act - petition allowed by way of remand. Issues: Lack of opportunity of hearing before passing Ext.P11 order under GST Act and Rules.In this judgment, the petitioner approached the Court aggrieved by Ext.P11 order passed against him under the GST Act and Rules, alleging that he was not given an adequate opportunity of hearing or a chance to respond to the show cause notice before the order was issued. The Court heard arguments from both the petitioner's counsel and the Government Pleader representing the respondents. The Government Pleader acknowledged that there was indeed a lack of proper hearing afforded to the petitioner as required by the Rules. Consequently, the Court allowed the writ petition, quashed the Ext.P11 order, and directed the respondent to reconsider the matter. The respondent was instructed to provide the petitioner with copies of documents to be relied upon, consider any reasonable request for cross-examination of individuals, and take note of an earlier objection that was not considered. The petitioner was required to appear before the respondent to facilitate the fresh proceedings, with a deadline set for the respondent to pass new orders within three months.This judgment primarily addresses the issue of procedural fairness and the right to be heard before an adverse order is passed under the GST Act and Rules. It emphasizes the importance of providing an opportunity for the party to present their case, access relevant documents, and request cross-examination of witnesses. The Court's decision highlights the significance of adhering to the principles of natural justice and ensuring a fair and transparent adjudicatory process in matters concerning tax disputes. By setting aside the original order and directing a fresh consideration with proper hearing procedures, the judgment upholds the fundamental right to a fair trial and underscores the duty of authorities to conduct proceedings in accordance with the statutory requirements and principles of natural justice.