M/S Vighnaharta Const. Thru. Its Prop. Vishnu Bhagwan Shukla Distt. Gonda vs. State Of U.P Thru. Commissioner CGST And Central Excise Lko. Zone And 2 Others

Held

The Court held that the order passed under Section 74(9) of the GST Act was indeed vitiated for want of an opportunity of hearing. The Court noted that after the petitioner sought an adjournment, a reminder notice was sent on 10.02.2021, indicating a reply submission date of 17.04.2021, but the columns for the date, time, and venue of personal hearing were marked 'NA'. Furthermore, the impugned order under Section 74 itself did not indicate that any opportunity of hearing was granted. Citing Section 75(4) of the GST Act, which mandates granting an opportunity of hearing, and relying on the precedent set in Writ Tax No.174 of 2023, the Court quashed the order passed under Section 74. Consequently, the order dated 26.12.2022, which lost its efficacy, was also quashed. The Court directed respondent no.3 to pass a fresh order after providing an opportunity of hearing in accordance with law. The Court did not expressly leave any issue undecided.

Facts

The petitioner, M/s Vighnaharta Const., received a show cause notice under Section 61 of the GST Act on 08.09.2020. Subsequently, an order under Section 74(9) was passed on 14.07.2021, confirming a demand against the petitioner. The petitioner claimed to be suffering from an incurable disease and could not file an appeal within the prescribed time, leading to the dismissal of their appeal on 14.07.2021. The petitioner contended that they sought an adjournment due to illness, but no hearing was granted, and the order under Section 74(9) was passed ex-parte. The Court called for records to verify the opportunity of hearing.

Key Issues

1. Whether the order passed under Section 74(9) of the GST Act is vitiated for want of an opportunity of hearing, as mandated by Section 75(4) of the GST Act? Petitioner's arguments: The petitioner argued that despite seeking an adjournment due to illness and annexing a medical certificate, no hearing was granted before the order under Section 74(9) was passed. They relied on a previous judgment of this Court in Writ Tax No.174 of 2023 (M/s Santosh Traders vs. State of U.P. and others) which remanded a similar matter on the ground of non-compliance with Section 75(4). The petitioner also argued that since the appeal was dismissed solely on limitation, the original order did not merge with the appellate order. Respondent's arguments: The respondent did not record any specific arguments against the petitioner's contention regarding the lack of hearing. The respondent's counsel initially raised an objection regarding the improper description of respondent no.1, which the Court noted but found would not affect the outcome.