Ms Manmohan Steels vs. State Of Punjab And Another

Facts

The petitioner, M/s Manmohan Steels, filed a writ petition before the High Court of Punjab & Haryana challenging an adjudication order dated 09.01.2023. The petitioner's primary contention was that the adjudication order was passed without granting them an opportunity of hearing. The respondent-State, through its counsel, conceded that no prior opportunity of hearing was provided to the petitioner before the issuance of the impugned adjudication order. The court was therefore called upon to decide the validity of an order passed in violation of natural justice principles and statutory provisions.

Held

The Court held that the impugned adjudication order dated 09.01.2023 was violative of the principles of natural justice. Furthermore, it was found to be in contravention of Section 75(4) of the Central Goods and Services Tax Act, 2017, which mandates that an opportunity of personal hearing must be offered to an assessee before any adverse order is contemplated against them. The Court reasoned that the failure to provide a hearing rendered the order unsustainable. Consequently, the adjudication order was set aside. The State was granted liberty to proceed afresh against the petitioner in accordance with the law, implying that a fresh adjudication process, including providing an opportunity of hearing, should be undertaken. No specific amount in dispute was mentioned, nor were any other procedural aspects or specific tax periods detailed.

Key Issues

1. Whether the adjudication order dated 09.01.2023 is liable to be set aside on the ground that no opportunity of hearing was granted to the petitioner, thereby violating the principles of natural justice? 2. Whether the adjudication order dated 09.01.2023 is liable to be set aside for non-compliance with Section 75(4) of the Central Goods and Services Tax Act, 2017, which mandates an opportunity of personal hearing before passing an adverse order? Petitioner's Contention: The petitioner argued that the adjudication order was passed without providing them with a hearing, which is a fundamental principle of natural justice and a statutory requirement. Revenue's Contention: The respondent-State agreed that no opportunity of hearing was granted to the petitioner prior to the issuance of the adjudication order.