2024 (10) TMI 716 - HC - GST

Natural Justice Prevails: Administrative Order Challenged for Procedural Flaws, Comprehensive Reply Ordered Within Two Weeks

HC reviewed a case challenging an administrative order for violating natural justice. The court found procedural irregularities in the notice and order ... Violation of principles of natural justice and fair play - impugned order made without giving the petitioner an opportunity of hearing - HELD THAT:- In this case, the show cause notice dated 10 April 2023 required the petitioner to file a response within 30 days. The notice clearly indicates the date, timing, and venue of the personal hearing. On 21 June 2023, the Petitioner sought time to file a reply. The defence that the show cause notice was not uploaded on the petitioner’s designated portal is not convincing. There was undoubtedly some delay in responding to the show cause notice on the petitioner's part. Though the reason for the show cause notice not being uploaded on the petitioner’s portal is not very convincing, given the fact that the impugned order was made or digitally signed only on 25 June 2023, the petitioner deserves to be granted an opportunity of hearing subject to the petitioner paying costs. This opportunity would address the argument about natural justice without prejudicing the revenue’s interests disproportionately. The reply dated 21 June 2023 does not appear to be on merits, but the reply refers to the show cause notice not being uploaded to the petitioner’s designated portal. Accordingly, subject to the payment of costs of Rs. 50,000/-, the petitioner is granted two weeks to file a reply to the show cause notice dated 10 April 2023. After such a reply is filed, the 4th respondent should dispose of the show cause notice dated 10 April 2023 after considering the reply and hearing the petitioner. The show cause notice must be disposed of as expeditiously as possible and, in any event, within eight weeks of receiving the reply if the same is filed. Petition disposed off. Issues:Challenge to order violating natural justice and fair play.Analysis:The petitioner challenged an order made by the 4th respondent, alleging a violation of natural justice and fair play. The petitioner's counsel argued that the impugned order was issued without giving the petitioner an opportunity to be heard, despite the petitioner having filed a reply to the show cause notice. The counsel contended that the order inaccurately stated that no reply was filed, breaching principles of natural justice. The respondents' counsel, however, argued that the show cause notice clearly outlined the timeline for response and details of a personal hearing, which the petitioner failed to adhere to. The respondents maintained that there was no failure of natural justice on their part.The High Court noted that the show cause notice provided a specific timeline for response and details of the personal hearing. The petitioner sought an extension to file a detailed reply, which was eventually submitted after some delay. The court acknowledged that the response was filed before the impugned order was issued, indicating that the petitioner's version was before the 4th respondent at the time of decision. Despite the delay and the dispute over the notice's upload location, the court deemed it appropriate to grant the petitioner an opportunity to be heard, subject to the payment of costs, to ensure fairness without unduly prejudicing revenue interests.The court directed the petitioner to file a comprehensive reply to the show cause notice within two weeks, upon payment of costs amounting to Rs. 50,000. It further instructed the 4th respondent to dispose of the show cause notice promptly after considering the reply and hearing the petitioner, within eight weeks of receiving the response if filed. The judgment emphasized expeditious resolution of the matter, leaving all contentions open for consideration. The relief granted was contingent upon the petitioner paying the prescribed costs to the Prime Minister's Relief Fund within two weeks, as a pre-condition for benefiting from the court's order. The petition was disposed of accordingly, with instructions for all concerned parties to act in accordance with the court's decision.