Vilas Chandanmal Gandhi vs. State Of Maharashtra And Ors

Held

The Court held that the Petitioner was not granted an opportunity of a personal hearing as mandated by Section 75(4) of the CGST/MGST Act, and therefore, the contention of the Revenue regarding no breach of natural justice could not be accepted. The Court also found it necessary for Respondent No. 3 to consider the effect of the order passed by Respondent No. 4, in light of Section 6(2)(b) of the CGST/MGST Act and the Supreme Court's guidelines in Armour Security (India) Ltd. Accordingly, the three impugned orders were quashed and set aside, and the proceedings were remanded to Respondent No. 3 for passing a fresh reasoned order. The Petitioner was directed to appear before Respondent No. 3, and was permitted to file submissions. The contentions of both parties on merits were expressly kept open. No issue was expressly left undecided.

Facts

The Petitioner, Vilas Chandanmal Gandhi, challenged three orders passed by the State Tax Officer (Respondent No. 3) demanding GST on alleged supply of transferrable development rights for periods between July 2017 and March 2019. The Petitioner argued that these orders were without jurisdiction, citing Section 6(2)(b) of the CGST/MGST Act, as the Additional Commissioner (HPU), CGST Pune (Respondent No. 4) had already passed an order on the same subject matter for the same periods. The Petitioner also contended that the impugned orders were passed without granting a personal hearing, violating Section 75(4) of the CGST/MGST Acts. The Revenue argued that the Petitioner did not bring the prior order of Respondent No. 4 to the notice of Respondent No. 3, and that principles of natural justice were not breached as a show cause notice was served and a reply was considered.

Key Issues

1. Whether the orders passed by Respondent No. 3 are without jurisdiction and contrary to Section 6(2)(b) of the CGST/MGST Act, 2017, given that Respondent No. 4 had already passed an order on the same subject matter for the same periods? The Petitioner argued that Section 6(2)(b) bars further proceedings by an authority subordinate to the one that has already passed an order. The Revenue contended that Respondent No. 3 was unaware of the prior order. 2. Whether the impugned orders are liable to be set aside for being passed without granting an opportunity of a personal hearing to the Petitioner, as mandated by Section 75(4) of the CGST/MGST Acts, 2017? The Petitioner relied on decisions of this Court emphasizing the mandatory nature of personal hearings. The Revenue argued that principles of natural justice were satisfied. The Court had to decide if the procedural requirements of Section 75(4) were met.