2024 (8) TMI 1574 - HC - GST

GST officer must provide personal hearing opportunity before adverse decisions under Section 75(4) UP GST Act

M/s Sai Dham Residency Versus State of U.P. and Another

The Allahabad HC held that under Section 75(4) of the U.P. GST Act, 2017, a registered person must be granted personal hearing opportunity before adverse ... Violation of principles of natural justice - SCN did not propose to grant personal hearing - HELD THAT:- Undeniably, the notice issued to the petitioner under Section 73(1) of the Act dated January 16, 2024 did intend to call for a reply from the petitioner but did not propose to grant personal hearing as the abbreviation 'NA' was specified against the column 'date of personal hearing'. In that against the columns to specify the date of personal hearing, time of personal hearing and venue for personal hearing, the abbreviation 'NA' i.e. 'Not Applicable' was recorded. Thus, upon service of notice, the petitioner had been called to file its reply only. Consequently, non-compliance of that show cause notice may have only led to closure of opportunity to submit written reply. However by virtue of the express provision of Section 75 of the Act, even in that situation the petitioner did not lose its right to participate at oral hearing and establish at that stage itself that the adverse conclusions proposed to be drawn against the petitioner, may be dropped. Thus, no useful purpose may be served in keeping this petition pending or calling counter affidavit at this stage or to relegate the present petitioner to the forum of alternative remedy. The order impugned has been passed contrary to the mandatory procedure. The deficiency of procedure is self apparent and critical to the out-come of the proceedings - Matter is remitted to the respondent No. 2 to pass a fresh order. Petition allowed by way of remand. The Allahabad High Court, per Hon'ble Shekhar B. Saraf and Manjive Shukla, JJ., held that under Section 75(4) of the U.P. GST Act, 2017, a registered person must be granted an opportunity of personal hearing before any adverse decision is taken. The petitioner was issued a notice under Section 73(1) without specifying a date for personal hearing ('NA' recorded), resulting in denial of this statutory right. The Court emphasized that the rules of natural justice under the Act require two independent opportunities: submission of a written reply and oral hearing; failure to avail one does not forfeit the other. The impugned order dated April 25, 2024, was set aside for non-compliance with mandatory procedural requirements. The matter was remitted for fresh adjudication, allowing the petitioner to file a final reply and appear for personal hearing, after which a reasoned order shall be passed. The writ petition was accordingly allowed.