Case Law Details
Jain Medicals Vs State of U.P. and Another (Allahabad High Court)
When it’s established as a legal principle that an assessee isn’t obligated to request a ‘personal hearing,’ the Assessing Authority must still provide this opportunity before making an adverse order. Therefore, marking ‘No’ in the personal hearing choice holds no legal consequence.
In a significant ruling, the Allahabad High Court addressed the issue of denial of oral hearing under Section 75(4) of the U.P. GST Act, 2017. The case, Jain Medicals Vs State of U.P. and Another, challenged an adverse assessment order passed against Jain Medicals by the Assistant Commissioner, State Tax, Sector – 2, Pratapgarh, Prayagraj for the tax period 2017-18. The petitioner contended that the order, which imposed a demand in excess of Rs. 60,383, was issued without affording them an opportunity for an oral hearing.
The core contention before the court was the denial of an opportunity for oral hearing to Jain Medicals. The petitioner argued that the assessing authority had failed to comply with the principles of natural justice as mandated by Section 75(4) of the U.P. GST Act, 2017. This section stipulates that an opportunity of hearing must be granted before any adverse decision is contemplated against the person chargeable with tax or penalty.
Citing precedents such as Bharat Mint & Allied Chemicals Vs. Commissioner Commercial Tax and a decision by the Gujarat High Court in M/S Hitech Sweet Water Technologies Pvt. Ltd. Vs. State of Gujarat, the petitioner asserted that the denial of oral hearing rendered the assessment order invalid. The petitioner further emphasized that marking ‘NA’ for personal hearing in the notice issued to them was arbitrary and against the principles of natural justice.
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