2024 (12) TMI 443 - HC - GST

Appellate authority must provide proper hearing notice before rejecting GST appeal under Section 107(8)

Karnataka HC allowed writ petition challenging appellate order under CGST/KGST Acts. Court found that appellate authority failed to provide proper hearing ... Appeal against order under CGST and KGST Acts - It is the contention of the petitioner that during the pendency of the appeal before the second respondent, the second respondent has issued an endorsement and thereafter passed the order dated 31.08.2024 (Annexure-J1 to the writ petition) rejecting the appeal - It is further contended that the petitioner had no notice of the orders that were passed by the Appellate Authority - HELD THAT:- The endorsement dated 20.08.2024 does not notify the petitioner of a date of hearing of the appeal and hence the second respondent-Appellate Authority erred in passing the subsequent order dated 31.08.2024. It is just and proper that the petitioner be afforded an opportunity of hearing in the appeal filed by him before the second respondent in terms of Section 107 (8) of the KGST Act and consequent to the same, the Appellate Authority be permitted to conduct further proceedings in accordance with law. The endorsement bearing No. JCCT(Appeals)/ BGV/2024-25/B-291 dated 20.08.2024 issued by the second respondent (Annexure-J) is quashed - he order dated 31.08.2024 passed in Appeal No.GST-165/2024-25/B-338 by the second respondent (Annexure-J1) is quashed - Petition allowed in part. Issues:1. Appeal against order under CGST and KGST Acts2. Allegations of lack of notice and procedural irregularities in appeal process3. Dispute over the rejection of the appeal by the Appellate Authority4. Request for setting aside subsequent actions and quashing of proceedingsAnalysis:The petitioner filed a writ petition seeking a mandamus to revive an appeal and a certiorari to quash an order. The appeal was against an order under the Central Goods and Service Tax (CGST) and Karnataka Goods and Service Tax (KGST) Acts. The petitioner alleged that during the pendency of the appeal, the Appellate Authority issued an endorsement and subsequently rejected the appeal without proper notice. The petitioner argued that they were not informed of the orders passed by the Authority. On the other hand, the respondents contended that the petitioner was duly served and failed to appear, justifying the rejection of the appeal and initiation of proceedings. The court considered the submissions and reviewed the case facts.The court noted that the petitioner had filed the appeal within the stipulated time and paid the required amount. The Appellate Authority issued an endorsement notifying the petitioner of the belated filing and provided an opportunity to respond within seven days. However, the endorsement did not specify a date for the appeal hearing. Consequently, the court found that the Authority erred in rejecting the appeal without a proper hearing as required under the KGST Act. It was deemed necessary to afford the petitioner a fair hearing and allow the Authority to proceed in accordance with the law.As a result, the court partially allowed the writ petition. It quashed the endorsement and order rejecting the appeal, along with the pending proceedings. The petitioner was directed to appear before the Appellate Authority without further notice. Subsequent proceedings were to be conducted in compliance with the law. The court set aside the actions taken based on the flawed endorsement and allowed the respondents to take appropriate steps after the conclusion of the appeal proceedings. All contentions of both parties were left open for future consideration.