Seya Industries Limited vs. State Of Maharashtra And Ors

Facts

The Petitioner, Seya Industries Limited, filed two writ petitions before the Bombay High Court. In Writ Petition No. 15885 of 2023, the Petitioner challenged impugned orders passed by the revenue authorities. The Petitioner argued that these orders were passed without granting an opportunity of hearing, violating Section 75(4) of the CGST Act. The revenue's contention was that no hearing was granted because the Petitioner never received any notices and thus had nothing to submit. In Writ Petition No. 15700 of 2023, the Petitioner challenged Show Cause Notices (SCNs) issued by Respondent No. 3 and sought adjudication after considering their reply. The Petitioner requested a personal hearing and that the adjudicating authority consider their response dated 4th July 2023.

Held

The Court held that even though the Petitioner in Writ Petition No. 15885 of 2023 had not replied to the Show Cause Notices, an opportunity of hearing should have been granted before passing the impugned orders. The Court quashed and set aside the impugned orders and remanded the matter for denovo consideration. However, the Petitioner's request for a fresh opportunity to file a reply was declined. The revenue was directed to pass a reasoned order after giving a personal hearing, dealing with all submissions, and communicating notice at least seven working days in advance. For Writ Petition No. 15700 of 2023, the Court directed Respondent No. 3 to adjudicate the Show Cause Notices considering the Petitioner's reply dated 4th July 2023. A personal hearing was to be granted, with advance notice of at least seven working days. The adjudicating officer was also directed to provide a list of any judgments/orders they intended to rely on in advance of the hearing. Written submissions after the hearing were permitted within three working days, and the final order was to be reasoned and detailed, dealing with all submissions. The Show Cause Notices were to be disposed of by 30th September 2024.

Key Issues

1. Whether the impugned orders in Writ Petition No. 15885 of 2023 are vitiated for having been passed without granting an opportunity of hearing, as mandated by Section 75(4) of the CGST Act, 2017, despite the Petitioner not having filed a reply to the Show Cause Notices? Petitioner's contention: Section 75(4) mandates an opportunity of hearing when an adverse decision is contemplated. Since the orders were adverse, a hearing should have been granted, and its absence vitiates the orders. Revenue's contention: No hearing was granted because the Petitioner never received the notices, implying they had nothing to submit, making a hearing purposeless. 2. Whether Respondent No. 3 in Writ Petition No. 15700 of 2023 should adjudicate the Show Cause Notices after considering the Petitioner's reply dated 4th July 2023 and granting a personal hearing? Petitioner's contention: The matter should be adjudicated after considering their response and granting a personal hearing.