Sri Srinivasa Lorry Transport Vs Assistant Commissioner St and Others (Andhra Pradesh High Court)
An opportunity of personal hearing must be granted before an adverse decision is passed
Andhra Pradesh High Court, in Sri Srinivasa Lorry Transport v. Assistant Commissioner ST (W.P. Nos. 5385 & 5456 of 2021), ruled that an adverse tax decision cannot be passed without granting a personal hearing, even if not explicitly requested. The case arose when the petitioner, an unregistered transporter, was inspected by the tax authorities and later issued an assessment and penalty order under the CGST and APGST Acts. The petitioner challenged these orders on the grounds that no personal hearing was granted and that at least three adjournments should have been provided under Section 75(5) of the CGST Act. The court held that while Section 75(5) limits adjournments to three, it does not mandate a minimum of three adjournments. Furthermore, prior authorization was found unnecessary for assessments under Section 63 of the CGST Act, as it applies specifically to unregistered persons. The court set aside the impugned orders, reaffirming that a taxpayer must be given an opportunity to present their case before an adverse decision is made. The ruling clarifies that while procedural compliance is essential, natural justice principles must be upheld. It also distinguished between authorization for inspections under Section 67 and assessments under Section 63, confirming that no additional approval is needed for the latter. The tax authorities were directed to conduct a fresh assessment, ensuring due process and personal hearing for the petitioner.
