2025 (7) TMI 1322 - HC - GST

Violation of principles of natural justice - the respondent passed the present impugned order without considering the reply ofthe petitioner - HELD THAT - Considering the submissions made by the learned counsel on either side and upon perusal of the materials it appears that the petitioner filed reply containing 130 pages and the same was extracted in the order also and hence the respondent has to provide an opportunity of personal hearing to the petitioner as mandated under Section 75(4) of the TNGST Act 2017. In the present case it appears that no opportunity of personal hearing was provided to the petitioner prior to the passing of impugned order. Hence this Court is of the view that the impugned order was passed in violation of principles of natural justice and it is just and necessary to provide an opportunity to the petitioner to establish their case on merits. The impugned order passed by the respondent dated 26.09.2024 is set aside - the matter is remanded to the respondent for fresh consideration - Petition allowed by way of remand.

Summary

ISSUES:

Whether the impugned order was passed without providing the petitioner an opportunity of personal hearing as mandated under Section 75(4) of the GST Act, 2017.Whether the impugned order based on electricity consumption to determine turnover and levy penalty under Section 74 of the GST Act, 2017, is justified without considering the petitioner's detailed reply.Whether the passing of the impugned order without considering the petitioner's reply violates principles of natural justice.

RULINGS / HOLDINGS:

The Court held that the impugned order was passed in violation of principles of natural justice as no opportunity of personal hearing was provided to the petitioner prior to passing the order, despite the petitioner filing a detailed reply of 130 pages.The Court found that the respondent failed to comply with the mandate under Section 75(4) of the GST Act, 2017, which requires issuance of a notice affording an opportunity of personal hearing before passing an order.The Court set aside the impugned order dated 26.09.2024 and remanded the matter to the respondent for fresh consideration, directing the respondent to provide a clear 14 days notice for personal hearing and decide the matter in accordance with law.

RATIONALE:

The Court applied Section 75(4) of the GST Act, 2017, which mandates that before passing an order of assessment or reassessment, the proper officer must provide the assessee an opportunity of being heard.The Court emphasized the fundamental principle of natural justice requiring that a party must be given a fair opportunity to present its case before adverse action is taken.The Court noted that the impugned order relied on electricity consumption data to infer undisclosed turnover and levy penalty under Section 74, but the petitioner's detailed reply was not considered, compounding the violation of natural justice.No dissent or doctrinal shift was indicated; the judgment reaffirmed established procedural safeguards under the GST regime.