Order set aside for violating natural justice; fresh hearing to be granted under fair procedure rules.

The HC set aside the impugned order for violation of natural justice, noting the respondent rejected the petitioner's reply without proper consideration and denied a fair opportunity of hearing. Although personal hearings were scheduled, the petitioner's representative was unable to attend due to illness. The court remanded the matter to the respondent for fresh consideration after affording the petitioner an adequate hearing. The petition was disposed of by way of remand.

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ISSUES:

Whether the impugned assessment order was passed without providing a proper opportunity of personal hearing to the petitioner.Whether the respondent applied judicial mind in rejecting the petitioner's replies to the show cause notice and reminder notice.Whether the recovery of Input Tax Credit (ITC) from the Electronic Credit Ledger (ECL) was valid in the absence of proper hearing and consideration of petitioner's submissions.

RULINGS / HOLDINGS:

The impugned order was passed without any application of mind, as the respondent merely stated "Verified the reply details to Your Reply not accepted" without proper consideration of the petitioner's submissions.Although opportunities for personal hearing were fixed on two occasions, the petitioner's inability to appear due to consultant's illness and submission of replies entitled the petitioner to a further hearing before passing final orders.The recovery of ITC from the petitioner's ECL was effected without providing a meaningful opportunity to be heard, rendering the impugned order liable to be set aside.

RATIONALE:

The Court applied the principles of natural justice, emphasizing the requirement of providing a fair opportunity of hearing before passing adverse orders under the TN GST Act, 2017/CGST Act, 2017.The statutory framework mandates issuance of show cause notices and personal hearings prior to final assessment and recovery of ITC, ensuring that the assessing authority must apply judicial mind to the replies and documents submitted by the assessee.The Court identified a procedural lapse where the assessing authority rejected the petitioner's replies summarily without detailed consideration, amounting to non-application of mind.There was no dissent or doctrinal shift; the judgment reaffirmed established principles of administrative law requiring fair hearing and reasoned orders in tax assessments.

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