J M Mhatre Infra PVT. LTD Thr. Authorized Chetan J. Mhatre vs. Union Of INDIA Thr. Secretary Dept. Of Revenue Ministry Of Finance And Ors

Facts

The Petitioner, JM Mhatre Infra Pvt. Ltd., filed a writ petition challenging an order passed by the Adjudicating Officer. The Petitioner contended that the impugned order was passed in breach of principles of natural justice as they were not given an opportunity of personal hearing. The Respondent-State argued that the Petitioner had ticked 'No' in the option for personal hearing in Form GST DRC-06, thus 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 when the reply itself requested a hearing.

Held

The Court held that the impugned order was passed in breach of the principles of natural justice. The Petitioner ought to have been granted an opportunity of personal hearing. The Court reasoned that while the Petitioner had inadvertently ticked 'No' in the option for personal hearing in Form GST DRC-06, their reply to the Show Cause Notice explicitly requested a personal hearing. This indicated an inadvertent error rather than an express waiver of the right to a hearing. The Adjudicating Officer's mechanical approach of relying solely on the tick mark, without considering the specific request in the reply, was found to be erroneous. The Court relied on Section 75(4) and 75(5) of the CGST Act and the precedent set in Kuehne Nagel Pvt. Ltd. Vs. State of Maharashtra. The Court quashed and set aside the impugned order and directed the Adjudicating Officer to grant an opportunity of personal hearing to the Petitioner and pass an appropriate order thereafter.

Key Issues

1. Whether the impugned order, passed by the Adjudicating Officer, is liable to be set aside for breach of principles of natural justice, specifically the denial of a personal hearing to the Petitioner, in light of Section 75(4) and Section 75(5) of the CGST Act? Petitioner's Argument: The Petitioner argued that despite explicitly requesting a personal hearing in their reply to the Show Cause Notice, the Adjudicating Officer mechanically adopted a procedural approach by only noting the inadvertent tick mark against 'No' for personal hearing in Form GST DRC-06. They contended that this constituted a breach of natural justice and that they had not expressly waived their right to a personal hearing. They relied on the decision of this Court in Kuehne Nagel Pvt. Ltd. Vs. State of Maharashtra. Revenue/State's Argument: The Respondent-State argued that the Petitioner had ticked the box for 'No' in the option for personal hearing in Form GST DRC-06, and therefore, there was no requirement for a personal hearing. They submitted that the Petitioner was given every possible opportunity to reply to the Show Cause Notice.