Natural Justice failure: order under GST adjudication quashed for absence of a fresh, definite personal hearing.

The article examines an Allahabad High Court decision quashing an order passed under the Central Goods and Services Tax Act, 2017 for failure to afford a fresh, definite personal hearing before adjudication under Section 74. It reasons that statutory hearing requirements and the principles of natural justice under Sections 75(4) and 75(6) were not satisfied because no fresh notice fixing date, time and venue was served after an earlier unattended hearing date. Applying the Coordinate Bench precedent in Shubham Steel Traders, the court found the procedure flawed and directed grant of another opportunity of hearing and fresh adjudication in accordance with law.

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Issues: Whether the order dated 20.01.2025 passed under Section 74 of the Central Goods and Services Tax Act, 2017 without fixing or granting any fresh personal hearing and without compliance with Section 75(4) (and Section 75(6)) is in violation of the principle of natural justice and therefore liable to be quashed.

Analysis: The impugned order was passed after an earlier show cause notice which fixed a hearing date; the petitioner did not attend that earlier date and no fresh notice was served fixing a definite date, time and venue for hearing before passing the order on 20.01.2025. The provisions of Section 75(4) and Section 75(6) of the Central Goods and Services Tax Act, 2017 require opportunity of hearing and compliance with principles of natural justice in adjudication under the GST framework. The matter is governed by the Coordinate Bench decision in Shubham Steel Traders v. State of U.P., which holds that passing an order without affording a fresh, definite hearing opportunity where none was served violates natural justice. Applying that principle and the statutory requirement of a hearing opportunity, the original order under Section 74, having been passed without fixing or granting a fresh personal hearing, is procedurally flawed.

Conclusion: The order dated 20.01.2025 passed under Section 74 of the Central Goods and Services Tax Act, 2017 is quashed and set aside; the authorities are directed to grant another opportunity of hearing to the petitioner and thereafter pass an order in accordance with law.

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