M/S Shivtara Settering Services vs. Commissioner State Tax Uttarakhand

Facts

The petitioner, M/s Shivtara Settering Services, filed a writ petition challenging an order dated 17.07.2025 passed by respondent no.3 under Section 74 of the Uttarakhand Goods and Services Tax Act, 2017. This order imposed a total tax liability of Rs.45,64,844/-, including a penalty of Rs.22,82,422/-, upon the petitioner firm. The petitioner contended that the impugned order was passed without providing an opportunity of hearing, which is a mandatory requirement under Section 75(4) of the Act. The petitioner also cited a previous writ petition, M/s Shivtara Developers vs. State of Uttarakhand & others, where a similar order under Section 74 was quashed on the same grounds. The Revenue argued that the petitioner had not opted for a personal hearing.

Held

The Court held that the impugned order dated 17.07.2025, passed by respondent no.3 under Section 74 of the Uttarakhand Goods and Services Tax Act, 2017, is quashed. The Court reasoned that Section 75(4) of the Act mandates that an opportunity of hearing shall be granted where a request is received in writing or where any adverse decision is contemplated. It has been repeatedly held by this Court and other High Courts that even if an assessee has not opted for a personal hearing, it is obligatory for the revenue to afford a personal hearing if an adverse order is proposed. This Court had taken the same view in a similar writ petition (Writ Petition (M/B) No.702 of 2026). The ratio decidendi is that the requirement of affording a personal hearing in cases of contemplated adverse orders is a mandatory procedural safeguard that cannot be bypassed, irrespective of whether the assessee explicitly requested it. The Court directed that it shall be open to the Department to pass a fresh order after providing an opportunity of hearing to the petitioner firm. No other issues were expressly left undecided.

Key Issues

1. Whether the impugned order dated 17.07.2025, passed under Section 74 of the Uttarakhand Goods and Services Tax Act, 2017, is liable to be quashed for non-compliance with the mandatory requirement of providing an opportunity of hearing as stipulated in Section 75(4) of the Act, despite the petitioner not explicitly opting for a personal hearing? Petitioner's contention: The petitioner argued that the order was passed in violation of Section 75(4) of the Act, which mandates an opportunity of hearing when an adverse decision is contemplated. They relied on the principle that even without an explicit request, a hearing must be provided in such circumstances, citing a precedent from this Court in a similar case (Writ Petition (M/B) No.702 of 2026). Revenue's contention: The Revenue contended that the petitioner firm had not opted for a personal hearing, and therefore, one was not provided. They did not cite any specific provision or precedent to support their argument.