GST Order Set Aside: Authority Failed to Provide Mandatory Personal Hearing Under Section 75(4) Before Passing Adverse Decision

The HC allowed the writ petition challenging an order under IGST Act, 2017, finding a violation of natural justice principles. The Court held that despite issuing a notice, the respondent failed to provide the petitioner with an actual personal hearing before passing an adverse order, contravening Section 75(4) of the GST Acts. The Court set aside the impugned order and remanded the matter for reconsideration after proper hearing, emphasizing that the statutory requirement for personal hearing is mandatory when an adverse decision is contemplated against a taxpayer.

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Issues: Violation of principles of natural justice in passing an order under the IGST Act, 2017 without providing an opportunity of personal hearing as required under Section 75(4) of the Act.

Detailed Analysis:

1. Violation of Principles of Natural Justice: The Writ Petition challenged an order passed by the First Respondent under the IGST Act, 2017, alleging it to be violative of the principles of natural justice and contrary to law. The petitioner sought relief through a Writ, Order, or Direction, particularly in the nature of MANDAMUS. The main contention was the lack of opportunity for personal hearing, as mandated by Section 75(4) of the GST Acts, 2017.

2. Contentions of the Parties: The learned counsel for the petitioner argued that there was a discrepancy between the show cause notice and the order passed by the Assessing Officer. It was contended that the matter should be remanded for a fresh decision after providing an opportunity for a hearing. On the other hand, the Government Pleader for Commercial Tax opposed this, arguing that Section 75(4) of the A.P.G.S.T. Act only requires an opportunity of hearing upon a written request.

3. Interpretation of Section 75(4) of the A.P.G.S.T. Act: The Court delved into the interpretation of Section 75(4) of the A.P.G.S.T. Act, which mandates that an opportunity of hearing shall be granted upon a written request from the person chargeable with tax or penalty, or when an adverse decision is contemplated against such person. The provision clearly outlines the circumstances under which a hearing must be provided.

4. Violation and Setting Aside of the Order: The Court found that in the present case, although a notice for personal hearing was issued, the petitioner was not given an actual opportunity for a hearing before the adverse order was passed. This lack of proper hearing amounted to a violation of Section 75(4) of the A.P.G.S.T. Act. Consequently, the Court allowed the Writ Petition, setting aside the impugned order and remanding the matter back for reconsideration after providing the petitioner with a notice of personal hearing.

5. Conclusion: The judgment concluded by granting the relief sought by the petitioner, emphasizing the importance of adhering to the principles of natural justice and providing a fair opportunity for a hearing as required by law. The Court directed that there shall be no order as to costs and closed any pending miscellaneous petitions related to the Writ Petition.

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