M/S Shivtara Developers vs. State Of Uttarakhand

Facts

The petitioner, M/s Shivtara Developers, 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 tax liability of Rs. 11,20,816/-, along with interest of Rs. 8,56,180.60/- and a penalty of Rs. 11,20,816/-. 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 referred to a previous writ petition filed by them, bearing Writ Petition (M/B) No.702 of 2026, which challenged a similar order under Section 74 for a different financial year and was decided in their favour. The Revenue, represented by the Standing Counsel, argued that the petitioner had not opted for a personal hearing, and therefore, none was provided.

Held

The Court held that the impugned order dated 17.07.2025, passed 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 against the person. The Court reiterated its previous consistent view, as also held by various 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 when proposing to pass an adverse order. This principle was applied in the petitioner's previous writ petition. The Court directed that it shall be open for the Department to pass a fresh order after providing an opportunity of hearing to the petitioner firm. No other issue was 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 violation of the mandatory requirement of providing an opportunity of hearing under Section 75(4) of the Act? Petitioner's contention: The petitioner argued that the order was passed without granting them an opportunity of hearing, which is a mandatory procedural requirement under Section 75(4) of the Act. They relied on a previous decision of the High Court in a similar writ petition (Writ Petition (M/B) No.702 of 2026) concerning a different financial year, where an order passed under Section 74 was quashed on similar grounds. Revenue's contention: The Revenue contended that the petitioner had not opted for a personal hearing, and consequently, it was not provided. They did not cite any specific provision or precedent to support their argument that opting for a personal hearing is a prerequisite for the Revenue to provide one when an adverse order is contemplated.