Tvl. Dhayalan Timber Traders vs. The State Tax Officer (Inspection Cell)

Held

The Court allowed the writ petitions on the ground of violation of the principles of natural justice. It was held that the respondent's explanation for not sending a personal hearing notice, stating the petitioner's whereabouts were unknown, was not acceptable. The Court emphasized that even if a pre-revision notice was returned, the assessing authority has a statutory duty to send a personal hearing notice through the modes contemplated by the statute and cannot assume non-receipt. The impugned orders were set aside. To address the respondent's contention of the petitioner's evasive conduct, the petitioner's counsel provided an undertaking that the assessee would visit the respondent's office on April 9, 2021, at 11:00 a.m. to provide their address for future communications and to receive the pre-revision notice for filing objections. The respondent was directed to intimate the next hearing date on that occasion. The Court expressly left undecided any substantive issues related to the tax liability itself, focusing solely on the procedural defect.

Facts

The petitioner, Tvl. Dhayalan Timber Traders, filed three writ petitions challenging orders passed by the State Tax Officer (Inspection Cell), Tirunelveli, for the financial years 2017-18, 2018-19, and 2019-20. The impugned orders were dated November 20, 2020. The primary ground for challenge was the alleged violation of the principles of natural justice, specifically the denial of a personal hearing as contemplated under the GST Act. The respondent contended that no personal hearing notice was sent because the petitioner's whereabouts were unknown. The petitioner sought to quash the orders and direct the respondent to issue proper notices, conduct proceedings, and afford an opportunity for objections and a personal hearing.

Key Issues

1. Whether the impugned assessment orders are illegal and invalid for violating the principles of natural justice, specifically by failing to provide a personal hearing to the petitioner as required by Section 75(4) and 75(5) of the GST Act? The petitioner argued that the assessment orders were passed without affording them an opportunity of a personal hearing, which is a mandatory procedural requirement under Section 75(4) and 75(5) of the GST Act. They contended that the respondent's explanation for not sending a personal hearing notice, i.e., unknown whereabouts, was unacceptable, as the petitioner had a known address and the respondent should have ensured service through statutory modes. The respondent argued that no personal hearing notice was sent because the petitioner's whereabouts were not known, implying the petitioner was evading service. They also suggested the petitioner was adopting a 'hide and seek' approach.