M/S. Preca Solutions INDIA PVT. LTD vs. Assistant Commissioner

Held

The Court held that the impugned order was passed in violation of both the mandatory provisions of sub-section (4) of Section 75 of the Central Goods and Service Tax Act, 2017, and the principles of natural justice. The Court found that while the impugned order stated that an opportunity of personal hearing was afforded, the cited reference was merely an authorization and not a notice issued to the petitioner. The Court concluded that the petitioner had requested a personal hearing, and this request was not properly addressed. Therefore, the impugned order was liable to be set aside. The Court allowed the Writ Petition, setting aside the order dated 18.11.2022, but clarified that the authorities were free to pass a fresh order after hearing the petitioner. No costs were awarded.

Facts

The petitioner filed a Writ Petition challenging an order dated 18.11.2022 passed by the Assistant Commissioner (State Tax). This order was preceded by a show-cause notice dated 22.06.2022, to which the petitioner submitted an explanation on 01.08.2022. The petitioner's primary contention was that the impugned order was passed in contravention of Section 75(4) of the Central Goods and Service Tax Act, 2017, and in violation of principles of natural justice, as no proper opportunity of hearing was provided. The revenue argued that issuing a show-cause notice and receiving an explanation satisfied the requirements of natural justice.

Key Issues

1. Whether the impugned order dated 18.11.2022 passed by the Assistant Commissioner (State Tax) was in contravention of the mandatory requirements of sub-section (4) of Section 75 of the Central Goods and Service Tax Act, 2017, and in violation of the principles of natural justice? Petitioner's argument: The petitioner argued that the Assistant Commissioner failed to provide a mandatory opportunity of personal hearing as required by Section 75(4) of the Act, thereby violating principles of natural justice. The petitioner contended that the reference cited in the impugned order as providing an opportunity of hearing was merely an authorization and not an actual notice issued to the petitioner for a personal hearing. Revenue's argument: The revenue contended that the issuance of a show-cause notice and the petitioner's submission of an explanation in response thereto constituted compliance with the principles of natural justice and the mandatory requirements of law.