M/S Syndicates Scrap Processing vs. Joint Commnr. Of State Tax, Enforcement

Facts

The petitioner, M/s Syndicates Scrap Processing, filed a writ petition before the High Court of Orissa at Cuttack challenging an order dated 23.03.2022 passed by the Joint Commissioner of Sales Tax, Enforcement (Opposite Party No. 1). This order pertains to an assessment made under Section 74(5) of the OGST Act. The petitioner argued that the assessment order was passed without assigning any reasons and solely contained demand details. Furthermore, the petitioner contended that the notice and relevant documents were not uploaded, and no opportunity of hearing was provided, rendering the order legally unsustainable. The Revenue Department, represented by the Additional Standing Counsel, conceded that the impugned order lacked reasons and an opportunity of hearing for the petitioner, agreeing that it could not be sustained.

Held

The Court held that the impugned order dated 23.03.2022, passed by the Joint Commissioner of Sales Tax, Enforcement, was unsustainable in law. This conclusion was based on the admitted fact that the order was passed without assigning any reasons and without providing the petitioner with an opportunity of hearing. The Court found that these procedural lapses violated fundamental principles of natural justice. Consequently, the Court quashed the order and remitted the matter back to the Assessing Officer. The Assessing Officer was directed to conduct a fresh assessment, provide the petitioner with an opportunity of hearing, consider any objections filed by the petitioner, and pass a reasoned and speaking order in accordance with the law. No issues were expressly left undecided.

Key Issues

1. Whether the assessment order dated 23.03.2022, passed by the Joint Commissioner of Sales Tax, Enforcement under Section 74(5) of the OGST Act, is liable to be quashed for being passed without assigning any reasons and without providing an opportunity of hearing to the petitioner? Petitioner's Arguments: The petitioner contended that the assessment order was unsustainable in law because it was passed without assigning any reasons and merely detailed the demand raised. Crucially, the petitioner argued that the notice and supporting documents were not uploaded, and consequently, no opportunity of hearing was afforded, violating principles of natural justice. The petitioner relied on the general principles of law requiring reasoned orders and an opportunity to be heard. Revenue's Arguments: The Revenue Department, through its learned Additional Standing Counsel, conceded that upon perusal of the impugned order, it was evident that no reasons were assigned by the authority and that no opportunity of hearing was given to the petitioner. Therefore, the Revenue agreed that the order could not be sustained in the eye of law.