M/S City Life Appliance Industries PVT. LTD. Lucknow Thru. Proprietor Rajeev Jaiswal vs. U.O.I. Thru. Secy. Ministry Of Finance New Delhi And 3 Others

Facts

The petitioner, M/s City Life Appliance Industries Pvt. Ltd., through its Proprietor Rajeev Jaiswal, filed a writ petition challenging an order dated 12.12.2023 passed under Section 73 of the GST Act and a subsequent order dated 17.10.2024 that dismissed their appeal as being beyond limitation. The petitioner's primary contention was that no opportunity of hearing was provided before the initial order under Section 73 was passed. The respondent revenue authority, through learned Standing Counsel, stated that the date of hearing fixed was earlier than the date of filing of the reply by the petitioner. 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 there was a clear non-compliance with Section 75(4) of the GST Act, as the petitioner was not granted an adequate opportunity of hearing before the order dated 12.12.2023 was passed. The Court found that this procedural lapse rendered both the impugned order dated 12.12.2023 and the subsequent appellate order dated 17.10.2024 unsustainable. The reasoning was based on the mandatory nature of providing a hearing as stipulated in Section 75(4) and the precedent set in the Mahaveer Trading Company case. The ratio decidendi is that an order passed in violation of the principles of natural justice, specifically the right to be heard, is liable to be quashed. Consequently, the matter was remanded to the assessing authority to pass a fresh order after providing the petitioner with a proper opportunity of hearing. No other issues were expressly left undecided.

Key Issues

1. Whether the order dated 12.12.2023 passed under Section 73 of the GST Act is sustainable in the absence of an opportunity of hearing being granted to the petitioner? (Question of law, concerning Section 75(4) of the GST Act). Petitioner's contention: The petitioner argued that the order under Section 73 was passed without affording them a proper opportunity of hearing, which is a mandatory requirement. They relied on the principle laid down in the case of Mahaveer Trading Company vs. Deputy Commissioner, State Tax and Anr. (Writ Tax No. 303 of 2024) decided on 04.03.2024. Respondent's contention: The respondent revenue authority, based on instructions, stated that the date of hearing fixed was prior to the date of filing of the reply by the petitioner, implying that an opportunity was indeed provided, though the timing might have been an issue. The respondent did not cite any specific provisions or precedents in their argument.