2023 (12) TMI 232 - HC - GST

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 ... Opportunity of personal hearing - principles of natural justice - application of Section 75(4) of the Central Goods and Services Tax Act, 2017 - set aside and remit for fresh considerationOpportunity of personal hearing - principles of natural justice - application of Section 75(4) of the Central Goods and Services Tax Act, 2017 - set aside and remit for fresh consideration - Validity of the assessment order passed without affording personal hearing and conformity with Section 75(4) of the CGST Act - HELD THAT: - The Court found that Section 75(4) mandates that an opportunity of hearing be granted where an adverse decision is contemplated against the person chargeable with tax, and that the petitioner had, in its reply to the show cause notice, specifically requested an opportunity of personal hearing in the event of any adverse order. The show cause notice had fixed a personal hearing date before the stipulated time for filing the reply and the petitioner produced a portal screenshot indicating it had opted for personal hearing, whereas the downloaded printout showed 'No'. Irrespective of the portal discrepancy and even if no reply had been filed, the Court held that the respondents were bound to afford personal hearing before passing an adverse assessment, and that the impugned assessment order dated 31.10.2023 was passed without such opportunity, thereby violating the statutory mandate and principles of natural justice. For these reasons the Court set aside the assessment order and remitted the matter to the authority for reconsideration after affording the petitioner a personal hearing and passing a detailed order in accordance with law. [Paras 11, 12, 13, 14]Impugned Assessment Order dated 31.10.2023 set aside; matter remitted to the authority for re-consideration after considering the reply and affording an opportunity of personal hearing, with personal hearing to be fixed as 12.12.2023 or another date as may be fixed.Final Conclusion: Writ petition allowed; assessment order set aside and matter remitted for fresh consideration after granting the petitioner a personal hearing and passing a reasoned order in accordance with law. 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.