M/S. Jbt (Jai Bharath Travels) vs. The Deputy Commissioner (St)

Held

The Court held that the petitioner was not afforded a reasonable opportunity to be heard, thereby violating the principles of natural justice. Consequently, the impugned Assessment Order dated 24.06.2020 passed by the 1st respondent was set aside. The Court found that the procedural irregularity in not granting a personal hearing necessitated remitting the matter back to the 1st respondent. The ratio decidendi is that an assessment order passed without affording a personal hearing to the assessee, when such a hearing is a prerequisite under the principles of natural justice, is unsustainable. The Court directed the 1st respondent to afford a personal hearing to the petitioner, allowing the petitioner to raise all permissible legal pleas, and to pass a fresh Assessment Order on merits expeditiously. The Garnishee Notices, being consequential to the impugned Assessment Order, were implicitly set aside by the remand of the assessment proceedings.

Facts

The petitioner filed a Writ Petition challenging an Assessment Order dated 24.06.2020 passed by the 1st respondent (Commercial Tax Officer) for the tax periods 2017-18, 2018-19, and 2019-20. The petitioner also challenged the issuance of Garnishee Notices by the 2nd respondent on 27.10.2020 and 31.10.2020 under Section 79(1)(c) of the GST Acts, 2017, to respondents 5-8. The petitioner contended that these actions were taken without serving the Assessment Order and before the expiry of the appeal limitation period. The petitioner argued that principles of natural justice were violated as no personal hearing was granted before the Assessment Order was passed.

Key Issues

1. Whether the Assessment Order dated 24.06.2020 passed by the 1st respondent is illegal, arbitrary, and without jurisdiction for violating the principles of natural justice by not affording a personal hearing to the petitioner? 2. Whether the Garnishee Notices dated 27.10.2020/31.10.2020 issued by the 2nd respondent are illegal and without jurisdiction, having been issued without serving the Assessment Order and before the expiry of the appeal limitation period? Petitioner's Contentions: The petitioner argued that the Assessment Order was passed in gross violation of the principles of natural justice as no personal hearing was accorded. The petitioner sought to set aside the order and requested a direction for a fresh assessment after providing a personal hearing. Revenue's Contentions: The learned Government Pleader for Commercial Taxes fairly left the matter to the discretion of the Court.