J M Mhatre Infra PVT. LTD Thr. Authorized Chetanj Mhatre vs. Union Of INDIA Thr. Secretary And Ors

Facts

The Petitioner, JM Mhatre Infra Pvt. Ltd., filed a writ petition challenging an order passed by the GST authorities. The Petitioner contended that the impugned order was passed in breach of natural justice as they were not granted a personal hearing. The Respondent-State argued that the Petitioner had ticked 'No' in the option for personal hearing in Form GST DRC-06, thereby waiving their right. However, the Petitioner's reply to the Show Cause Notice explicitly requested a personal hearing. The Court noted that ticking 'No' for personal hearing in the form appeared to be an inadvertent error, especially since a specific request for hearing was made in the reply.

Held

The Court held that the impugned order was passed in breach of the principles of natural justice. The Court found that while the Petitioner had ticked 'No' in the option for personal hearing in Form GST DRC-06, this appeared to be an inadvertent error. Crucially, the Petitioner had specifically requested a personal hearing in their reply to the Show Cause Notice. The Court reasoned that a mechanical approach by the adjudicating officer, focusing solely on the ticked box without considering the explicit request for a hearing in the reply, was incorrect. The Petitioner had not expressly waived their right to a personal hearing. Therefore, the Court quashed and set aside the impugned order and directed the Adjudicating Officer to grant an opportunity of personal hearing to the Petitioner, consider all contentions, and pass an appropriate order. The Petitioner was directed to appear before the Adjudicating Officer on October 19, 2026, and the Show Cause Notice was to be adjudicated within four weeks from that date.

Key Issues

1. Whether the impugned order was passed in breach of the principles of natural justice, specifically concerning the denial of a personal hearing to the Petitioner, contrary to Section 75(4) of the CGST Act? Petitioner's Argument: The Petitioner argued that despite specifically requesting a personal hearing in their reply to the Show Cause Notice, the adjudicating authority failed to grant one. They contended that ticking 'No' for personal hearing in the Form GST DRC-06 was an inadvertent error and should not be interpreted as an express waiver of their right to be heard, especially when a contrary request was made in the detailed reply. They relied on the decision in Kuehne Nagel Pvt. Ltd. Vs. State of Maharashtra. Revenue/State's Argument: The Respondent-State argued that the Petitioner had explicitly opted out of a personal hearing by ticking the 'No' box in Form GST DRC-06, and therefore, no personal hearing was required. They submitted that every possible opportunity was given to the Petitioner to reply to the Show Cause Notice.