Mandatory personal hearing and reasoned appellate orders under GST vitiate non-compliant adjudication and justify remand.

The Allahabad HC held that a personal hearing is mandatory under Section 75(4) of the GST Act when sought in reply to the show cause notice, and failure to grant it vitiates the adjudication for breach of statute and natural justice. It further held that an appellate order must record the points for determination, the decision and reasons under Section 107(12); a bare order noting non-appearance without dealing with the merits is unsustainable. Accordingly, both the adjudication and appellate orders were quashed and the matter was remitted for fresh decision after affording hearing.

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Issues: (i) Whether the adjudication order passed under Section 73 of the GST Act was unsustainable for want of an opportunity of personal hearing under Section 75(4) of the GST Act. (ii) Whether the appellate order was unsustainable for not deciding the appeal on merits with points for determination, decision and reasons as required by Section 107(12) of the GST Act.

Issue (i): Whether the adjudication order passed under Section 73 of the GST Act was unsustainable for want of an opportunity of personal hearing under Section 75(4) of the GST Act.

Analysis: An opportunity of hearing is mandatory under Section 75(4) of the GST Act, and the requirement is not displaced merely because a separate request is not reiterated at every stage. Where a personal hearing is sought in reply to the show cause notice and no hearing is granted, the adjudication suffers from violation of the statutory mandate and the principles of natural justice.

Conclusion: The adjudication order was held to be unsustainable and was quashed.

Issue (ii): Whether the appellate order was unsustainable for not deciding the appeal on merits with points for determination, decision and reasons as required by Section 107(12) of the GST Act.

Analysis: An appellate authority is required to dispose of the appeal by a written order stating the points for determination, the decision thereon and the reasons for the decision. An order that merely notes non-appearance and absence of evidence, without an adjudication on the merits of the grounds raised, does not satisfy this statutory requirement.

Conclusion: The appellate order was held to be unsustainable and was quashed.

Final Conclusion: The impugned adjudication and appellate orders were set aside and the matter was remitted for fresh decision after affording an opportunity of hearing.

Ratio Decidendi: Where the GST statute mandates a personal hearing and a reasoned appellate determination, non-compliance with those requirements vitiates the orders and warrants remand for fresh adjudication.

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