2026 (2) TMI 947 - HC - GST

Procedural fairness: opportunity to reply and personal hearing required before final GST adjudication; fresh consideration permitted.

Procedural fairness in GST adjudication is central: where a taxpayer did not file a reply or attend a personal hearing due to lack of portal access and ... Right to be heard - principle of natural justice - remand for fresh adjudication - access to statutory portal to enable filing of reply - costs awarded for procedural non-compliance - validity of notifications issued u/s 168A of the Central Goods and Services Tax Act - HELD THAT:- On facts, a Show Cause Notice was issued to the Petitioner on 29th May, 2024 (‘SCN’). A reminder notice dated 5th July, 2024 was also issued to the Petitioner fixing a date for personal hearing on 15th July, 2024. However, no reply has been filed to the SCN or the reminder, nor any personal hearing has been attended by the Petitioner. The reason given by the Petitioner is that the same were missed due to an inadvertent oversight by the previous consultant and the Petitioner itself did not have any access to the GST Portal, except through the consultant. Thereafter, the impugned order has been passed without the Petitioner having an opportunity to deal with the case on merits. Considering the fact that the Petitioner did not get a proper opportunity to be heard and no reply to the impugned SCN has been filed by the Petitioner, the matter deserves to be remanded back to the concerned Adjudicating Authority, as the challenge to the Notifications is pending consideration. The impugned order is accordingly set aside. Issues: Whether the impugned adjudication order raising tax and penalties (for the period April 2019 to March 2020) is liable to be set aside and remanded because the petitioner was not afforded an opportunity to file a reply or attend personal hearing; and whether relief should be granted pending resolution of challenges to Notifications issued under Section 168A of the Central Goods and Services Tax Act, 2017.Analysis: The Court examined the factual position that no reply to the Show Cause Notice dated 29th May, 2024 and no attendance at the personal hearing fixed by the adjudicating authority had been filed/attended by the petitioner, the explanation being inadvertent oversight and lack of access to the GST portal through the prior consultant. The Court noted precedents and analogous writ petitions where, in similar circumstances, orders passed without affording an opportunity to be heard were set aside and remanded for fresh consideration. The Court considered the ongoing and unresolved question before the Supreme Court regarding the validity of Notifications issued purportedly under Section 168A of the Central Goods and Services Tax Act, 2017, and observed that the validity of those Notifications is left open and any fresh adjudication would be subject to the outcome of the Supreme Court proceedings. Balancing these factors, the Court held that procedural fairness required that the petitioner be given an opportunity to file a reply and be heard before any final order on the SCN is rendered.Conclusion: The impugned order is set aside and the matter is remanded to the adjudicating authority for fresh adjudication after the petitioner files a reply and is afforded a personal hearing. The petitioner is granted time until 15th December, 2025 to file the reply; access to the GST portal shall be provided within one week; the adjudicating authority shall consider the reply and personal hearing submissions and pass a fresh reasoned order. The question of validity of the impugned notifications under Section 168A of the Central Goods and Services Tax Act, 2017 is left open and any order shall be subject to the outcome of S.L.P No 4240/2025 before the Supreme Court.