Sunny Kumar vs. Assistant Commissioner

Facts

The petitioner, Sunny Kumar, filed a writ petition challenging two orders. The first order, dated May 25, 2022, cancelled the petitioner's GST registration. The second order, dated July 2, 2025, was passed under Section 74 of the UKGST Act, 2017. During the proceedings, the petitioner's counsel stated that the relief sought regarding the cancellation of GST registration was not being pressed. Therefore, the petition was confined to challenging the order dated July 2, 2025. The petitioner's primary contention was that this order was passed without fixing or providing a date for a personal hearing, as evidenced by the show cause notice dated July 7, 2023, which did not mention any such date.

Held

The Court held that the order dated July 2, 2025, passed by the respondent under Section 74 of the UKGST Act, 2017, was unsustainable and liable to be quashed. The reasoning was based on the concession made by the Revenue's counsel that the order was passed without providing the petitioner with an opportunity of hearing. This was found to be a direct violation of the provisions of Section 75(4) of the Act, which mandates providing an opportunity of hearing before passing an order. The ratio decidendi is that an order passed in violation of the principles of natural justice, specifically the right to be heard, is void ab initio. Consequently, the Court quashed the impugned order dated July 2, 2025, and reserved liberty for the Revenue to pass a fresh order based on the show cause notice, after providing the petitioner with an adequate opportunity of hearing. The relief concerning the cancellation of GST registration was not pressed by the petitioner.

Key Issues

1. Whether the order dated July 2, 2025, passed by the respondent under Section 74 of the UKGST Act, 2017, is liable to be quashed for being passed without providing an opportunity of personal hearing to the petitioner, as mandated by Section 75(4) of the Act? Petitioner's Contention: The petitioner argued that the impugned order dated July 2, 2025, was passed in violation of principles of natural justice, specifically by failing to provide a personal hearing. The show cause notice dated July 7, 2023, did not mention any date for personal hearing, indicating a lack of opportunity for the petitioner to present their case. Respondent's Contention: The learned counsel for the Revenue fairly conceded that the impugned order was indeed passed without affording any opportunity of hearing to the petitioner, thereby admitting a violation of Section 75(4) of the Act.