M/S P.B.C. Infrastructure INDIA PVT. LTD.Thru. Authorized Signatory Mr.Mohammad Anas vs. Addl. Commissioner Grade-Ii( Appeal), State Tax, Lko. And Another

Facts

The petitioner, M/s P.B.C. Infrastructure India Pvt. Ltd., challenged an order dated 08.04.2024 passed under Section 73 of the GST Act and a subsequent appellate order dated 07.02.2025 that dismissed their appeal due to non/short-payment. The petitioner's primary contention was that the order under Section 73 was passed without providing an adequate opportunity of hearing. The respondent, Additional Commissioner Grade-II (Appeal), State Tax, Lko., through the Standing Counsel, stated that the notice issued to the petitioner fixed the hearing date prior to the deadline for filing the reply. The petitioner relied on a previous judgment of this Court in Writ Tax No.303 of 2024 (Mahaveer Trading Company vs. Deputy Commissioner, State Tax and Anr.) dated 04.03.2024.

Held

The Court held that the order dated 08.04.2024 passed under Section 73 of the GST Act was in violation of Section 75(4) of the GST Act, which mandates providing an opportunity of hearing to the assessee. The Court found that the hearing date was fixed prior to the date for filing the reply, rendering the opportunity of hearing ineffective. Following its own precedent in Mahaveer Trading Company vs. Deputy Commissioner, State Tax and Anr., the Court quashed both the order dated 08.04.2024 and the appellate order dated 07.02.2025. The matter was remanded to the assessing authority to pass a fresh order after granting the petitioner a proper opportunity of hearing. The Court did not expressly leave any issue undecided.

Key Issues

1. Whether the order dated 08.04.2024 passed under Section 73 of the GST Act is vitiated for non-compliance with the principles of natural justice, specifically the right to a hearing, as required by Section 75(4) of the GST Act? Petitioner's Contention: The petitioner argued that the order under Section 73 of the GST Act was passed without affording them a proper opportunity of hearing, thus violating the principles of natural justice. They relied on the judgment in Mahaveer Trading Company vs. Deputy Commissioner, State Tax and Anr. (Writ Tax No.303 of 2024), which dealt with a similar issue. Respondent's Contention: The respondent, based on instructions, contended that the notice issued to the petitioner scheduled the hearing date before the date for filing the reply, implying that an opportunity was provided, albeit with a procedural anomaly. They did not present any specific counter-arguments against the reliance on the Mahaveer Trading Company precedent.