Case Law Details
Gannon Dunkerley & Co. Limited Vs Joint Commissioner Corporate Circle and 4 others (Allahabad High Court)
In the case of Gannon Dunkerley & Co. Limited vs. Joint Commissioner Corporate Circle and 4 Others, the Allahabad High Court addressed a writ petition challenging a GST assessment order dated August 6, 2024. The petitioner argued that the assessment order was issued under Section 73 of the U.P. GST/C.G.S.T. Act, 2017, for the financial year 2019-20 without adhering to principles of natural justice. The show-cause notice dated May 25, 2024, provided no specific date or venue for a personal hearing. Despite the petitioner explicitly requesting a hearing in its reply submitted on the same date as the assessment order, the authority proceeded to finalize the order without granting the requested hearing.
The respondent’s counsel contended that multiple opportunities had been provided to the petitioner and that the order was passed under the constraint of a statutory deadline. However, the Court found that the notice’s omission of a hearing schedule demonstrated a lack of intent to provide a hearing, and prior opportunities referenced by the respondents did not fulfill the procedural requirement. The Court emphasized that the limitation for passing the assessment did not justify bypassing the petitioner’s right to a personal hearing.
The Court quashed the assessment order and directed the authorities to initiate fresh proceedings, allowing the petitioner a personal hearing. It further instructed the petitioner to appear before the authority on December 10, 2024, without requiring a fresh notice. This decision underscores the critical importance of upholding natural justice in administrative proceedings under the GST framework.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. This writ petition is directed against the order dated 06.08.2024 passed under Section 73 of U.P.G.S.T./C.G.S.T. Act, 2017 for financial year 2019-20.
2. Though several pleas have been raised in the present writ petition, learned counsel for the petitioner submitted that the show- cause notice was issued on 25.05.2024 under Section 73 of the Act wherein the petitioner was required to submit a reply by 25.06.2024, however in the column pertaining to date of personal hearing, time of personal hearing and the venue where the personal hearing will be held, ‘NA’ was indicated, i.e., no date was fixed for personal hearing. The reply to the show-cause notice was filed by the petitioner on 08.2024 and in form GST DRC-06 (Annexure- 6) in the column pertaining to option for personal hearing, the petitioner indicated ‘Yes’ and in the reply filed specifically indicated that an opportunity of personal hearing may be granted before taking a decision in the above matter. However, ignoring the said prayer, the assessment order has been passed on 06.08.2024 itself, i.e., on the date of filing of the reply without affording any opportunity of hearing and, therefore, in view of the fact that the assessment order has been passed in violation of principles of natural justice, though a specific prayer in this regard was made by the petitioner, assessment impugned deserves to be set aside.
3. Learned Government Counsel, with reference to the order passed by the authority, made submissions that several opportunities were granted to the petitioner, however a wholly laconic response to the show-cause notice was filed and as the limitation for passing the assessment was expiring, the order impugned has been passed.
4. We have considered the submissions made by counsel for the parties and have perused the material available on record.
5. A bare look at the show-cause notice issued to the petitioner itself reveals that the Assessing Authority had no intention to afford any opportunity of hearing as in the column pertaining to personal hearing, as noticed hereinbefore, ‘NA’ has been indicated. However, as from DRC-06 provided for a column pertaining to the personal hearing, wherein the petitioner specifically marked ‘Yes’ and also made a prayer in reply to the show-cause notice for affording opportunity of personal hearing, it was incumbent upon the authorities to provide an opportunity of hearing.
6. However, apparently on 06.08.2024 itself, the order has been passed, which ex facie, is against the principles of natural justice. The plea raised pertaining to the fact that the opportunity was granted to the petitioner, the indications made in the show-cause notice cannot and does not pertain to any opportunity after filing of the reply and demanding the opportunity of hearing. Any previous opportunity, i.e., prior to the issuance of show-cause notice, is of no consequence.
7. So far as the fact that the limitation for passing the assessment was expiring, that also cannot be a reason for not affording opportunity of hearing to the party, may be that a short date could have been fixed by the authority for that purpose.
8. In view of the above fact situation, the assessment made by order dated 06.08.2024 (Annexure-8) cannot be sustained. The same is, therefore, quashed and set aside leaving it open to the authorities to pass a fresh order after affording opportunity of hearing to the petitioner.
9. Petitioner shall now, in the first instance, appear before the authority on 10.12.2024. It would not be required of the authority to issue a fresh notice for the said purpose.
10. With the above directions/observations, the writ petition stands allowed.
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