Personal hearing before adverse tax adjudication is mandatory; orders passed without it were quashed and remanded.

An adverse tax adjudication under the Uttar Pradesh Goods and Services Tax Act, 2017 cannot be sustained where the noticee is not granted a meaningful opportunity of personal hearing before the order is passed. The court treated the hearing requirement as mandatory because it goes to procedural fairness in tax determination, and held that replies to the show cause notice did not cure the absence of an oral hearing. The impugned orders were therefore quashed and the matter remanded for fresh adjudication on merits after affording a proper hearing.

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Issues: (i) Whether an adjudication order under the Uttar Pradesh Goods and Services Tax Act, 2017 could be sustained when no opportunity of personal hearing was granted before passing the adverse order. (ii) Whether the impugned orders were liable to be quashed and the matter remanded for fresh adjudication after hearing.

Issue (i): Whether an adjudication order under the Uttar Pradesh Goods and Services Tax Act, 2017 could be sustained when no opportunity of personal hearing was granted before passing the adverse order.

Analysis: The record showed that the noticee had filed replies to the show cause notice, but no further notice fixing any personal hearing was issued and no opportunity of oral hearing was granted before the adverse adjudication. The procedural requirement of hearing before making an adverse tax determination was treated as mandatory, and the governing statutory framework required such opportunity where an adverse decision was contemplated.

Conclusion: The order passed without granting an opportunity of personal hearing was not sustainable and was liable to be set aside.

Issue (ii): Whether the impugned orders were liable to be quashed and the matter remanded for fresh adjudication after hearing.

Analysis: Since the defect went to the fairness of the adjudicatory process, the proper course was to invalidate the orders and direct reconsideration after granting a hearing to the noticee. The matter was therefore sent back to the assessing authority for a fresh decision on merits after compliance with the hearing requirement.

Conclusion: The impugned orders were quashed and the matter was remanded for fresh adjudication after affording an opportunity of hearing.

Final Conclusion: The challenge succeeded on the ground of denial of hearing, and the tax adjudication was reopened for a fresh decision in accordance with law after observance of procedural fairness.

Ratio Decidendi: An adverse tax adjudication cannot be sustained where the authority fails to grant the noticee a meaningful opportunity of personal hearing before passing the order.

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