Natural justice in GST demand proceedings requires a meaningful hearing opportunity; absence of effective hearing vitiated the demand order.

A demand order under the Odisha Goods and Services Tax Act, 2017 was quashed because the show-cause proceedings did not provide a meaningful opportunity of hearing. The court treated the absence of a specific personal hearing date, despite a date for filing reply, as a breach of natural justice in a demand proceeding. It granted the petitioner two weeks to file a reply, with liberty to seek personal hearing in that reply or separately thereafter, and directed that the impugned order would stand restored if no reply was filed within the time allowed.

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Issues: Whether the demand order was liable to be set aside for want of a proper opportunity of hearing in the show-cause proceedings under the Odisha Goods and Services Tax Act, 2017.

Analysis: The challenge was founded on the notice having indicated a date for filing reply but not a specific date for personal hearing. The absence of an effective hearing opportunity in a demand proceeding was treated as a violation of natural justice. The revenue accepted that time could be granted to enable a reply and, if sought, a personal hearing thereafter.

Conclusion: The impugned demand was quashed. The petitioner was granted two weeks to file a reply to the show-cause notice, with liberty to seek personal hearing in that reply or separately thereafter. If no reply is filed within the time granted, the impugned order stands restored.

Ratio Decidendi: In a demand proceeding, a show-cause notice must afford a meaningful opportunity to respond, and denial of an effective opportunity of hearing vitiates the consequential demand order.

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