Hari Lal vs. Union Of INDIA Th Secretary, Ministry Of Finance, New Delhi And Others

Held

The Court held that in view of the consensus arrived at between the parties, the impugned order dated 01.02.2025 passed by Respondent No. 4 was quashed. The Court directed that the petitioner be granted 10 days from the date of the order to submit his response to the Show-Cause Notice. If necessary, an opportunity of hearing was to be afforded to him. Respondent No. 4 was directed to pass a fresh speaking order in accordance with law after considering the petitioner's response. Additionally, the petitioner was directed to deposit 10% of the total tax payable in terms of the demand raised against him. The Court explicitly stated that this order was not to be treated as a precedent, having been passed due to the peculiar facts and circumstances and on the basis of consent.

Facts

The petitioner, Hari Lal, challenged an order dated 01.02.2025 passed by Respondent No. 4 under Section 73(9) of the GST Act, 2017. This order raised a demand of Rs. 20,97,064 against the petitioner for the financial year 2020-2021. The petitioner contended that the order was passed in violation of the principle of audi alteram partem and Section 75(4) of the GST Act, 2017, as he was not afforded a proper opportunity of hearing. The respondents, through their counsel, agreed to provide an opportunity of hearing and pass a fresh order in accordance with law.

Key Issues

1. Whether the impugned order dated 01.02.2025, passed by Respondent No. 4, is liable to be quashed for violating the principle of audi alteram partem and Section 75(4) of the GST Act, 2017? Petitioner's Argument: The petitioner argued that the impugned order was passed in utter disregard of the principle of audi alteram partem and in violation of the express statutory provisions contained in Section 75(4) of the GST Act, 2017, implying a lack of proper hearing. Revenue's Argument: The revenue, through its counsel, conceded that the respondent concerned shall provide an opportunity of hearing to the petitioner and thereafter pass a fresh order strictly in accordance with law. They requested that this concession not be treated as a precedent.