2023 (2) TMI 588 - HC - GST

Taxpayer's Rights Triumph: Assessment Order Nullified for Denying Personal Hearing Under GST Act Section 75(4)

Sendhil Kumar Versus The State Tax Officer, Tiruvallur Assessment Circle, Chennai

HC quashed the assessment order due to violation of natural justice principles under Section 75(4) of GST Act, 2017. The court found that no personal ... Validity of assessment order - Violation of principles of natural justice - no personal hearing was afforded to the petitioner in the impugned assessment proceedings - HELD THAT:- Admittedly, no personal hearing was afforded to the petitioner in the impugned assessment proceedings as seen from the impugned assessment order. An adverse decision has also been taken by the respondent against the petitioner in the impugned assessment order. Therefore, necessarily the impugned assessment order has to be quashed on the ground of violation of the principles of natural justice as no personal hearing has been granted to the petitioner as contemplated under Section 75 (4) of the GST Act, 2017 and remanded back to the respondent for fresh consideration on merits and in accordance with law. The assessment order dated 28.12.2022 is hereby quashed and the matter is remanded back to the respondent for fresh consideration on merits and in accordance with law - Petition disposed off. Issues:Challenge to assessment order due to lack of personal hearing under Section 75(4) of the GST Act, 2017.Analysis:The petitioner filed a Writ Petition challenging the assessment order for the assessment year 2021-2022, contending that no personal hearing was provided during the assessment proceedings. The impugned assessment order determined the tax liability under CGST and SGST, imposing a penalty totaling Rs. 8,88,584.The petitioner relied on Section 75(4) of the GST Act, 2017, which mandates granting a personal hearing when an adverse decision is contemplated against the taxpayer. The Court noted that personal hearing is necessary even if no formal request is made by the taxpayer. Previous judgments by two Judges of the Court on this matter were cited, upholding the mandatory nature of providing personal hearing in case of an adverse decision.Agreeing with the previous decisions, the Court held that the absence of a personal hearing in the impugned assessment proceedings violated the principles of natural justice. Consequently, the assessment order was quashed, and the matter was remanded back to the respondent for fresh consideration, emphasizing the need for a personal hearing within twelve weeks.The Court directed the respondent to ensure compliance with the principles of natural justice and grant the petitioner a personal hearing on a specified date. The Writ Petition was disposed of with no costs, and the connected Writ Miscellaneous Petition was closed.