GST assessment order quashed for denying personal hearing under Section 75(4) CGST Act

The Madras HC set aside a GST assessment order passed under Section 75(4) of the CGST Act, 2017 for violating principles of natural justice. The court found that the tax authority failed to provide the petitioner with a personal hearing opportunity despite the statutory mandate and the petitioner's specific request in their reply to the show cause notice. The HC emphasized that Section 75(4) requires authorities to provide personal hearing opportunities when contemplating adverse decisions against assessees, regardless of whether requested. The court noted this violation could not be rectified and would cause revenue loss to the department, leading to the petition being allowed.

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Issues:
The main issue in this case is the lack of opportunity for personal hearing provided to the petitioner before the passing of the Assessment Order, which is alleged to be a violation of principles of natural justice.

Summary:
The petitioner challenged the Assessment Order passed by the 1st respondent, contending that it was done without granting an opportunity for personal hearing and without considering the written submissions and documents filed by the petitioner. The petitioner pointed out that the date of personal hearing mentioned in the show cause notice was before the stipulated time limit for filing a reply, which goes against the principles of natural justice.

The petitioner's counsel referred to Section 75(4) of the Central Goods and Services Tax Act, 2017, which mandates providing an opportunity of personal hearing before passing any adverse order. The petitioner had requested a personal hearing in their reply to the show cause notice, emphasizing the importance of this procedural safeguard.

The respondent argued that the petitioner had indicated "No" for the option of personal hearing in the documents, but the petitioner countered this by presenting evidence that they had actually opted for a personal hearing. The discrepancy between the uploaded and downloaded versions of the document was highlighted as a common issue faced by taxpayers.

After hearing both parties, the Court found that the petitioner's request for a personal hearing was valid and that the Assessment Order was passed without adhering to the mandatory provision of providing such an opportunity. The Court set aside the impugned order and directed the authorities to reconsider the matter, ensuring a detailed order is passed after affording the petitioner a proper opportunity for personal hearing.

The Court emphasized the importance of complying with statutory provisions to prevent any loss of revenue to the Department. The matter was remitted back to the Authority concerned for re-consideration, with a specific date for personal hearing being fixed to ensure procedural fairness and adherence to the law.

In conclusion, the writ petition was allowed, and the impugned order was set aside, with the case remitted for further consideration with the requirement of providing a proper opportunity for personal hearing to the petitioner.

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