GST Show Cause Notice Quashed: Procedural Fairness Upheld, Fresh Hearing Ordered with Opportunity to Respond

HC ruled on a GST show cause notice challenging its validity due to vagueness. The court quashed the initial notice, directing the petitioner to submit a reply by 15th April 2023 and mandating the authority to conduct a fresh hearing within three weeks. The decision ensured procedural fairness by providing an opportunity to respond without prejudging the substantive merits of the case.

---

---

Issues involved:
The issues involved in this case are the validity of a show cause notice issued under the Goods and Services Tax Act, 2017, and the breach of natural justice due to lack of specific grounds mentioned in the notice.

Validity of Show Cause Notice:
The petitioner, a registered entity under the Gujarat Goods and Services Tax Act, 2017, challenged a show cause notice dated 20.6.2022 issued by the Assistant Commissioner, Goods and Services Tax, calling for cancellation of registration. The notice alleged possible fraud without specifying any details or grounds, leading to the petitioner's contention of vagueness and lack of opportunity to defend. The petitioner argued that the notice was deficient in providing specific grounds and supporting material, thereby breaching natural justice.

Breach of Natural Justice:
The petitioner contended that the show cause notice lacked specific details and material to substantiate the allegation of fraud, depriving them of a fair opportunity to defend their case. The respondent, through the Assistant Government Pleader, defended the notice under section 29 of the Goods and Services Tax Act, 2017, stating that a personal hearing opportunity was provided, but the petitioner did not attend deliberately. However, the petitioner later acknowledged the receipt of a detailed show cause notice, post the initial hearing date, and sought permission to file a reply and requested a fresh date for a personal hearing.

Court's Decision:
Considering the subsequent developments and acknowledgment of the detailed show cause notice by the petitioner, the court disposed of the petition by issuing specific directions. The court directed the petitioner to submit a reply by 15th April 2023 and set a new date for a personal hearing within that period. The competent authority was instructed to make a decision within three weeks from the completion of the hearing process. The court quashed and set aside the initial notice dated 20.6.2022 to allow for a fresh order to be passed. It was clarified that the court's directions were limited and did not delve into the merits of the case presented by either party.

Conclusion:
The court allowed the petition in the specified terms, granting the petitioner an opportunity to respond to the detailed show cause notice and ensuring a fair hearing process within a defined timeline.

---