Ms Poddar Ispat Private Limited vs. Office Of The Deputy Commissioner

Facts

The petitioner, M/s Poddar Ispat Pvt. Ltd., filed a writ petition challenging an order dated 26.12.2025 and related recovery proceedings initiated by the Deputy Commissioner. The proceedings stemmed from a show-cause notice dated 14.05.2025 under Section 74(1) read with Section 122 of the Uttarakhand Goods and Services Tax Act, 2017, for the Financial Year 2023-24. The notice alleged utilization of inadmissible Input Tax Credit (ITC) of Rs.8,49,98,096/-. The petitioner submitted its reply on 26.12.2025, requesting the dropping of the notice and a personal hearing. However, on the same day, the impugned order was passed under Section 74(9) imposing tax and penalty, and recovery proceedings were initiated.

Held

The Court held that the procedure followed violated the principles of natural justice, specifically Section 75(4) of the Uttarakhand Goods and Services Tax Act, 2017. The Court found that although the petitioner requested a personal hearing, no advance intimation of a hearing date was provided. The Revenue's contention that the petitioner was heard on the day of filing the reply was deemed insufficient, as the show-cause notice did not put the petitioner on notice that a hearing would take place on that specific day. The Court reasoned that a person filing a reply may not be prepared for arguments on the same day. Therefore, the impugned order dated 26.12.2025 was set aside. The respondents were directed to fix a fresh date for hearing with due intimation to the petitioner and pass a fresh order in accordance with law. All pleas and contentions were left open to be raised before the proper officer.

Key Issues

1. Whether the impugned order dated 26.12.2025, passed under Section 74(9) of the Uttarakhand Goods and Services Tax Act, 2017, is liable to be quashed for violation of the principles of natural justice, specifically the right to a personal hearing as mandated by Section 75(4) of the Act? Petitioner's Arguments: The petitioner contended that despite requesting a personal hearing, no date was intimated, and no hearing was afforded before the order was passed. They argued that the show-cause notice was defective, lacking the necessary ingredients of Section 74, and that their reply was not considered. They relied on the principle of natural justice and Section 75(4) of the Act. Revenue's Arguments: The Revenue argued, citing the order's recital, that the petitioner's reply was considered and an opportunity of hearing was given. However, the Revenue did not dispute that the order was passed on the same day the reply was filed and that the show-cause notice did not explicitly mention that a personal hearing would occur on the date of reply submission.