2024 (2) TMI 128 - HC - GST

Tax Order Quashed: Procedural Lapses Invalidate Ex-Parte Decision, Ensuring Fair Hearing and Opportunity to Respond

HC found procedural irregularities in ex-parte tax order under GST Act. Petitioner successfully challenged the order due to lack of proper communication ... Violation of principles of natural justice - case of petitioner is that the impugned order passed u/s 73 of the Central Goods and Service Tax Act (CGST Act) is an ex-parte Order along with summary order of even date - HELD THAT:- Although the Petitioner was aggrieved by the order dated 13th June 2022 being passed without an opportunity being made available to the Petitioner to respond to the show cause notice as also without being given any opportunity for an oral hearing, the Petitioner on 18th January 2023 under protest, deposited an amount of Rs. 34,98,095/-. Such amount was deposited without prejudice to the rights and contentions of the Petitioner to assail the impugned order. Thus, no mistake can be attributed to the Petitioner for not having noticed the Notice or the Order on the portal. It is clear that all orders and notices were required to be placed in the “View Notices and Orders” window/ portal. It also appears to be quite clear from the perusal of the record that the Petitioner was not heard. It had no opportunity to reply to the show cause notice. It is in the interests of justice that the impugned orders are quashed and set aside. The proceedings are remanded to the Respondents for a fresh order to be passed after giving an opportunity to the Petitioner to reply to the show cause notice and after an opportunity of a hearing is granted to the Petitioner. The present proceedings disposed off and the proceedings remanded to the designated officer. Issues involved:The primary contention of the Petitioner is the ex-parte order passed under section 73 of the Central Goods and Service Tax Act. The Petitioner alleges lack of communication and opportunity to respond to the show cause notice.Summary:The Petitioner, registered under different states, contends that returns sent for scrutiny assessment led to notices being issued by Respondent No. 3. Despite a show cause notice issued in April 2022, an order was passed in June 2022 without the Petitioner's knowledge. The Petitioner learned of the order in January 2023 and deposited the specified amount under protest. Alleging lack of opportunity to respond or oral hearing, the Petitioner seeks to challenge the order.The Court, after hearing both parties and examining the evidence, finds merit in the Petitioner's contentions. It notes the procedure for viewing/downloading notices on the portal and concludes that the Petitioner was not at fault for not noticing the order. Emphasizing the lack of opportunity for the Petitioner to respond, the Court deems it just to quash the orders and remand the proceedings for a fresh order with proper opportunity for the Petitioner to reply and be heard.The Court directs the Petitioner to file a reply to the show cause notice within four weeks. The proceedings are disposed of, with all contentions left open, and the case is remanded to the designated officer for further action. No costs are awarded in this matter.