M/S Sayyad Akhtar Ali Through Its Partner Sayyad Mohabbat Ali vs. The State Of Madhya Pradesh

Held

The Court held that the impugned order is liable to be quashed. Analyzing Section 75(4) of the CGST Act, the Court found that an opportunity of hearing shall be granted not only when a request is received in writing but also where any adverse decision is contemplated against the person chargeable with tax or penalty. The judgment of the Co-ordinate Bench in Technosys Security System (P.) Ltd. (Supra) was found to fortify this view. It was evident from the impugned order that no opportunity of hearing was afforded to the petitioner. Therefore, the impugned order was quashed. The respondents were granted liberty to pass a fresh order in accordance with law, after affording an opportunity of hearing to the petitioner, if advised so. The petition was allowed and disposed of.

Facts

The petitioner, M/s Sayyad Akhtar Ali, through its partner Sayyad Mohabbat Ali, filed a writ petition challenging an order dated 02.07.2025 passed by the Joint Commissioner of State Tax, Ratlam Division, Indore. This order was issued under Section 73 of the Central Goods and Services Tax Act, 2017, for the financial year 2022-2023. The petitioner contended that the impugned demand order was passed in violation of Section 75(4) of the CGST Act, as no opportunity for a personal hearing was provided. The State argued that a personal hearing is only mandatory if requested by the assessee. The Court considered the arguments and relevant legal provisions.

Key Issues

1. Whether the impugned order of demand, passed under Section 73 of the CGST Act for the financial year 2022-2023, 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 CGST Act? Petitioner's Contention: The petitioner argued that the impugned order was passed in violation of Section 75(4) of the CGST Act because no opportunity for a personal hearing was granted. They further submitted that even without an explicit request, the authorities are obligated to provide a personal hearing when an adverse decision is contemplated. Reliance was placed on the judgment in Technosys Security System (P.) Ltd. Vs. Commissioner, Commercial Taxes. Respondent's Contention: The respondent/State argued that as per Section 75(4) of the CGST Act, an opportunity for personal hearing is to be given only when a request is made in this behalf by the assessee.