Kedriya Jal Ayog Sahkari Avas Samiti LTD And Another vs. State Of U.P. And 4 Others

Held

The Court held that in matters involving serious civil rights and liabilities, a minimum opportunity to show cause and a personal hearing ought to have been granted to the petitioner before passing an order creating a demand in excess of ten crores. The Court found a gross procedural lapse in the issuance of the impugned order without affording the petitioner an opportunity to be heard. Consequently, the Court deemed it unnecessary to keep the petition pending or call for a counter-affidavit at that stage. The Court disposed of the writ petition with a direction that the petitioner should treat the impugned order as a notice and submit its reply within two weeks. Following this, the housing authority is to fix an appropriate date for hearing and pass a reasoned and speaking order within a further period of four weeks. All rights and liabilities are to arise accordingly after this process.

Facts

The petitioners, Kedriya Jal Ayog Sahkari Avas Samiti Ltd and Another, challenged an order dated 19.5.2022 passed by the Additional Housing Commissioner. This order demanded Rs. 10,34,73,985/- as adjustment fee and Rs. 1,86,25,317/- towards GST. The petitioners argued that they were not granted a prior opportunity of hearing before the impugned order was passed. They also contended that, under the relevant government scheme, such an amount might not have been chargeable. The petitioners asserted that a limited opportunity to be heard would have allowed them to present facts leading to a more informed decision. While the Awas Vikas Parishad opposed the merits, it was not disputed that the impugned order creating a substantial demand was issued without affording the petitioners an opportunity to file objections or be heard.

Key Issues

1. Whether the impugned order dated 19.5.2022, demanding Rs. 10,34,73,985/- as adjustment fee and Rs. 1,86,25,317/- towards GST, is vitiated due to a gross procedural lapse, specifically the failure to grant the petitioner a prior opportunity of hearing and to file objections? Petitioner's Contention: The petitioners argued that the impugned order was passed without granting them a prior opportunity of hearing. They submitted that if they had been given a limited opportunity to be heard, they would have presented facts that might have led to a different, informed order. They also raised a contention on merits regarding the charging of the amount under the government scheme. Respondent's Contention: The counsel for the U.P. Awas Vikas Parishad opposed the contention raised on merits. However, it was not disputed by the respondent that the impugned order creating a significant demand was passed without affording the petitioner any opportunity to file objections or be heard.