M/S Brand Eyes Distributors Private Limited vs. State Of Uttar Pradesh And Another

Facts

The petitioner, M/s Brand Eyes Distributors Private Limited, filed a writ petition before the Allahabad High Court challenging an ex-parte order under Section 73(9) of the CGST/UPSGST Act, 2017, in the form GST DRC-07, dated July 15, 2024. This order was passed by the Deputy Commissioner, Sector-2, Noida, Gautam Budh Nagar, Uttar Pradesh. The petitioner also sought a direction to re-adjudicate the show cause notice dated May 15, 2024, after being given a proper opportunity. The court noted that both the show cause notice and the impugned order were passed subsequent to the cancellation of the petitioner's GST registration. Crucially, the court found that none of the notices were served upon the petitioner.

Held

The Court held that since none of the notices, including the show cause notice dated May 25, 2024, and the impugned order dated July 15, 2024, were served upon the petitioner, they were liable to be quashed and set aside. The reasoning was based on the fundamental principle of natural justice, which mandates that a party must be given notice and an opportunity to be heard before any adverse order is passed against them. The Court found that the ex-parte nature of the proceedings, coupled with the lack of service, rendered the order invalid. The ratio decidendi is that an order passed without proper service of notice and an opportunity of hearing is a nullity and deserves to be quashed. The Authority was directed to provide an opportunity of hearing to the petitioner by issuing notice through e-mail or registered post and thereafter pass a fresh order in accordance with law. The issue of the validity of the GST registration cancellation was not expressly decided.

Key Issues

1. Whether the ex-parte order dated July 15, 2024, passed under Section 73(9) of the CGST/UPSGST Act, 2017, is liable to be quashed on the grounds of non-service of notice, thereby violating the principles of natural justice? 2. Whether the respondent authority should be directed to re-adjudicate the show cause notice dated May 15, 2024, after providing a proper opportunity of hearing to the petitioner? Petitioner's Contentions: The petitioner argued that the impugned order and the show cause notice were passed without proper service of notice, leading to a violation of the principles of natural justice. They sought the quashing of the ex-parte order and a direction for a fresh adjudication with an opportunity to be heard. Respondent's Contentions: The judgment records no specific contentions from the respondent State of Uttar Pradesh or the Deputy Commissioner.