2024 (5) TMI 550 - HC - GST

Tax Order Quashed: Procedural Lapses Expose Violation of Natural Justice Principles in Section 74 Proceedings

M/s Ganeshi Lal And Sons Versus State of UP And 3 Others

HC found procedural violations in tax order under Section 74 of UP GST Act. The court quashed the original orders due to lack of personal hearing and ... Violation of principles of natural justice - no opportunity of personal hearing was granted to the petitioner - challenge to order passed u/s 74 of the Uttar Pradesh Goods and Services Tax Act, 2017 - HELD THAT:- The impugned orders are liable to be quashed and set aside. Accordingly, this Court issues a writ of certiorari quashing the orders dated November 26, 2022 and February 19, 2024 with a direction upon the officer concerned to provide a copy of the SIB report to the petitioner within three weeks from date and subsequent to providing the SIB report, opportunity of hearing must be afforded to the petitioner before passing final order under Section 74 of the Act. Petition allowed. Issues Involved:The issues involved in the judgment are the lack of opportunity of personal hearing and non-provision of the Special Investigation Branch Report (SIB report) to the petitioner in a matter concerning an order passed under Section 74 of the Uttar Pradesh Goods and Services Tax Act, 2017.Issue 1: Lack of Opportunity of Personal HearingThe petitioner, aggrieved by the order passed by the Assistant Commissioner State Tax and the appellate order by the Additional Commissioner, argued that no opportunity of personal hearing was granted to them. The petitioner contended that the absence of a personal hearing rendered the order null and void, breaching the principles of natural justice. Citing relevant case law, the petitioner emphasized the necessity of affording an opportunity of hearing before passing an adverse order under Section 74 of the Act. The Additional Chief Standing Counsel representing the State conceded that indeed no opportunity of hearing was provided to the petitioner. Consequently, the court found the impugned orders to be flawed and ordered their quashing.Issue 2: Non-Provision of SIB ReportThe petitioner also raised the issue that despite requesting the SIB report, it was not provided to them. The court, acknowledging this lapse, directed the concerned officer to furnish a copy of the SIB report to the petitioner within three weeks. Subsequently, the court mandated that the petitioner must be given an opportunity of hearing before any final order is passed under Section 74 of the Act. In light of these directions, the court allowed the writ petition, issuing a writ of certiorari to quash the orders dated November 26, 2022, and February 19, 2024.This summary provides a detailed breakdown of the issues involved in the judgment and the court's decision on each issue.