2024 (3) TMI 1217 - HC - GST

Natural Justice Violated: Tax Order Quashed as Commissioner Denied Petitioner Fair Hearing During Lockdown Period

M/s. Reliance Integrated Services Pvt. Ltd. Versus Commissioner of CGST & Central Excise, Belapur

HC found a breach of natural justice principles in a tax order. The Commissioner passed an adverse order without providing the petitioner a proper ... Assailing the order-in-original passed by the Commissioner - Violation of Principles of natural justice - HELD THAT:- We are of the clear opinion that the respondent before passing the impugned order, ought to have adopted the procedure not only to serve the show cause notice in the manner known to law, but also grant a fair and sufficient opportunity to the petitioner by issuing appropriate notices and only after granting an opportunity of a hearing and placing of all materials on record, an endeavour should have been made to pass appropriate orders. The principles of law in this regard are well settled. Thus, as the impugned order is passed in breach of the principles of natural justice, the same cannot be sustained. Issues involved:The primary contention is the breach of principles of natural justice in the order passed by the Commissioner, CGST & Central Excise, Belapur.Issue 1: Breach of principles of natural justiceThe petitioner challenged the order-in-original dated 13 May, 2021, alleging a violation of natural justice principles. The petitioner was not granted a proper opportunity to be heard before the adverse order was passed. The order mentioned dates for personal hearings, but there was no evidence that the petitioner was actually heard on those dates. Moreover, the order was issued during a lockdown period, and the petitioner claimed they were not served the order until February 2023. The High Court found these arguments valid, emphasizing the importance of following due process before passing adverse orders. The Court noted that the impugned order was passed in breach of the principles of natural justice, leading to its quashing and setting aside.In conclusion, the High Court, in light of the breach of natural justice principles, quashed the impugned order and remanded the proceedings to the respondent for fresh orders after giving the petitioner a proper opportunity to be heard. The petitioner was directed to submit a reply to the show cause notice within three weeks, and the respondent was instructed to pass appropriate orders within three weeks after the hearing. The Court kept all contentions open and disposed of the petition accordingly, without imposing any costs.