M/S D.R Construction Ramnagar Road, Faizabad Thru. Its Partner Kaushal Kishore Pandey vs. State Of U.P. Thru. Its Addl. Chief Secy. Commercial Tax Deptt. Lucknow And 2 Others

Held

The Court held that the order dated 21.01.2022, passed under Section 73 of the GST Act, was in violation of Section 75(4) of the GST Act, which mandates an opportunity of hearing. The Court noted that the petitioner's specific pleading regarding the lack of hearing was not denied by the respondent, and the impugned order did not mention any opportunity of hearing being provided. Following its own previous judgment in Writ-Tax No.176 of 2023, which dealt with identical facts, the Court quashed both the order dated 21.01.2022 and the appellate order dated 14.03.2024. The Court granted liberty to the State to issue a fresh demand order in accordance with law, ensuring that an opportunity of hearing is provided. The authority is directed to specify the date, time, and place of hearing in the notice.

Facts

The petitioner, M/s D.R Construction, challenged an order dated 21.01.2022 passed under Section 73 of the GST Act and a subsequent order dated 14.03.2024 that dismissed their appeal as time-barred. The petitioner contended that the order under Section 73 was passed without providing an opportunity of hearing, which is mandated by Section 75(4) of the GST Act. The petitioner cited a previous judgment of the same High Court in Writ-Tax No.176 of 2023, which dealt with a similar issue of non-compliance with the hearing requirement. The respondent, the State of U.P., did not deny the petitioner's specific pleading that no opportunity of hearing was granted, and the impugned order was also silent on this aspect.

Key Issues

1. Whether the order dated 21.01.2022, passed under Section 73 of the GST Act, is liable to be quashed for violation of the mandatory requirement of affording an opportunity of hearing as stipulated in Section 75(4) of the GST Act? Petitioner's contention: The petitioner argued that the order under Section 73 was passed without granting an opportunity of hearing, violating Section 75(4) of the GST Act. They relied on the High Court's judgment in Writ-Tax No.176 of 2023, which held that an order passed without a hearing is invalid. The petitioner also noted that the counter-affidavit did not deny this specific pleading, and the impugned order itself was silent on the grant of hearing. Revenue's contention: The judgment records no specific argument from the respondent State of U.P. regarding this issue.