GST assessment orders u/s 74 quashed for denying mandatory personal hearing u/s 75(4), matters remanded

HC held that the impugned assessment orders passed under Section 74 of the GST Act were vitiated for violation of principles of natural justice. Since Section 75(4) mandates grant of a personal hearing where requested in writing or where an adverse decision is contemplated, the authority was bound to afford such hearing before determining tax liability. The assessees had specifically sought a personal hearing, which was ignored. Consequently, the assessment orders were set aside and the matters remanded, directing the assessees to appear before the assessing authority on the specified date with all supporting materials for fresh consideration.

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Issues involved:
The challenge to assessments made under the Tamil Nadu Goods and Service Tax Act for the periods 2017-18 and 2018-19, focusing on violation of principles of natural justice.

Summary:

Violation of Principles of Natural Justice:
The petitioners raised concerns about the initiation of proceedings by State Tax Department officers despite being registered as a Central assessee. However, during the hearing, the focus was on the violation of principles of natural justice. The petitioners had requested a personal hearing before the finalization of proceedings, which was ignored by the assessing officer. The impugned orders were passed under Section 74 of the Act, with the officer being obligated to adhere to the general provisions under Section 75 for tax determination. Section 75(4) mandates granting a hearing opportunity upon a written request from the taxpayer or when an adverse decision is anticipated. Since the petitioners specifically sought a personal hearing, the officer should have scheduled a hearing, listened to the petitioners, and then determined the tax payable.

Decision and Remand:
As a result of the above circumstances, the impugned assessment orders were set aside. The petitioners were directed to appear before the assessing officer on a specified date with supporting materials, treating the impugned orders as show cause notices as well. They were permitted to provide a detailed reply to all points from the assessment orders, show cause notices, and previous counters filed. The officer was instructed to pass orders within six weeks after considering the petitioners' submissions. Failure to appear on the specified date would result in the revocation of the benefits granted under the order. The writ petitions were allowed by way of remand, with no costs imposed, and connected miscellaneous petitions were closed.

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