2024 (8) TMI 1441 - HC - GST

Procedural Errors Invalidate Tax Proceedings: Technical Glitches Breach Statutory Notice Requirements Under RGST/CGST Act Section 75(4)

The SC found violations of natural justice and Section 75(4) of RGST Act/CGST Act. Technical glitches preventing notice reflection on GSTN Portal ... Violation of principles of natural justice - petitioner’s right of opportunity of personal hearing in the manner as provided under the law has been violated - HELD THAT:- Section 75 of the RGST Act of 2017/the CGST Act of 2017 contains general provisions relating to determination of tax. Sub-section (2) thereof explicitly provides that where any Appellate Authority or Appellate Tribunal or Court concludes that the notice issued under sub-section (1) of Section 74 of that Act is not sustainable for the reason that the charges of fraud or any willful-misstatement or suppression of facts to evade tax has not been established against the person to whom the notice was issued, the proper officer shall determine the tax payable by such person, deeming as if the notice was issued under sub-section (1) of Section 73 of that Act. The respondents have admitted the fact that even though the respondents intended to grant opportunity of personal hearing to the petitioner and notices to that effect were also uploaded on the portal of the Department, the petitioner’s case is that the same were though uploaded on the portal of the Department, but were not reflected on the GSTIN Portal of the petitioner, which also goes as an undisputed factual position. This is clear from the additional affidavit filed by the petitioner and the response received pursuant to that query which is also annexed along with the additional affidavit filed by the petitioner. It is, therefore, apparent that the statutory mandate was not complied with and impugned orders were passed against the petitioner in respect of different assessment years. The matters are remanded back to the competent authority for affording opportunity of personal hearing to the petitioner and passing appropriate orders in accordance with law - Petition allowed by way of remand. Issues:Violation of principles of natural justice and mandatory provisions of Section 75 (4) of the RGST Act of 2017/CGST Act of 2017.Analysis:The writ petitions raised concerns regarding the violation of principles of natural justice and mandatory provisions of Section 75 (4) of the RGST Act of 2017/CGST Act of 2017. The petitioner contended that despite submitting replies and seeking to contest the matters on merits, the impugned orders did not afford them the opportunity of personal hearing as mandated by law. The petitioner argued that the notices were not reflected on their GSTIN Portal, leading to a breach of statutory provisions. On the other hand, the respondents acknowledged that the notices were uploaded but not reflected due to technical glitches, asserting that it was not a deliberate denial of the opportunity of personal hearing.The court examined Section 75 of the RGST Act of 2017/CGST Act of 2017, emphasizing the importance of granting an opportunity of hearing when requested in writing by the person chargeable with tax or penalty. It was noted that the petitioner had indeed submitted applications in each case requesting a personal hearing, which was acknowledged by the respondents. However, due to the failure to reflect the notices on the petitioner's GSTIN Portal, the statutory mandate was not fulfilled. Consequently, the court found that the petitioner's right to a personal hearing had been infringed, leading to the setting aside of the impugned orders solely on this ground.In the final judgment, the court set aside the impugned orders and remanded the matters back to the competent authority for affording the petitioner the opportunity of personal hearing in accordance with the law. The respondents were directed to complete the proceedings within two months, with a strict instruction against seeking adjournments. The court clarified that its decision was based on procedural grounds, allowing the petitioner to raise all available legal grounds in subsequent proceedings. Ultimately, the writ petitions were allowed, and the office was instructed to record the judgment in each petition.