Non-appearance for personal hearing on date fixed by GST Officer is not violation of natural justice

TSN Old Iron Scrap Mechants Vs Deputy Assistant Commissioner of State Tax (Andhra Pradesh High Court)

Introduction: The Andhra Pradesh High Court, in TSN Old Iron Scrap Mechants v. Deputy/Assistant Commissioner of State Tax [Writ Petition No. 32206 of 2023 December 15, 2023], ruled that an assessee’s non-appearance for a personal hearing on the date fixed by a GST Officer does not constitute a violation of natural justice.

Hon’ble Andhra Pradesh High Court held that even though the copy of the information received was not supplied but the contents were disclosed to the assessee in the Show Cause Notice (“SCN”).  The Assessee had no justifiable reason for not appearing for personal hearing on date fixed. The Assessee had statutory alternative remedy of appeal and the writ petition was dismissed. This article delves into the details of the case, examining the facts, issues, and the court’s verdict.

Facts:

TSN Old Iron Scrap Merchants (“the Petitioner”) were issued a SCN issued on May 27, 2023 where it was mentioned that a letter was sent to NAHI vide reference 6th cited i.e. March 1, 2023 for passing tollgate data, the same data was received from them and on the same basis the Order (“Impugned Order”) was passed under Section 74 of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) on August 3, 2023. However, the information or the report so received from NAHI was not supplied to the Petitioner.

The Petitioner contended that the notice for personal hearing was served on July 17, 2023, and the date of personal hearing was also decided to be July 17, 2023. Therefore, the Petitioner could not appear on the said date.

Subsequently, the Deputy/Assistant Commissioner of State tax (“the Respondent”) issued another Notice for the personal hearing on July 21, 2023, and fixed July 24, 2023. The Petitioner could not appear before them for the reason that July 22, 2023, and July 23, 2023, were Saturday and Sunday and the time was not sufficient for personal appearance. Further, the Petitioner was at Vijayawada and the place of personal hearing was also at Vijayawada. Therefore, there is no justification for not availing the opportunity of personal hearing.

Hence, aggrieved by the Impugned Order the present writ petition was filed by the Petitioner.

Issue:

If the Assessee fails to appear before the GST Officer on the date fixed for personal hearing does it amount to the violation of natural justice?

Held:

The Andhra Pradesh High Court in­­­­­­­­­­ Writ Petition No. 32206 of 2023 December 18, 2023 held as under:

• Opined that, with respect to the violation of principles of natural justice of providing the opportunity of personal hearing is concerned, the notice dated July 21, 2023, was given to the Petitioner fixing the date July 24, 2023 (Monday). It could not be demonstrated before that why the Petitioner did not appear on the date fixed. The explanation of Saturday and Sunday is not for the date fixed. The Petitioner had no justifiable reason for not appearing for the personal hearing on the date fixed. If a person does not avail the opportunity of personal hearing, he cannot later on complain about the same.
• Held that, even if the copy of the information received was not supplied but the contents thereof were disclosed in the SCN, there would be no violation of the principles of natural justice as the material was disclosed to the Petitioner. The Petitioner had also submitted the reply to the SCN on July 7, 2023. On consideration of the Petitioner’s reply, the Impugned Order was passed.
• Held that, on the supra aspect the High Court of Andhra Pradesh found that there is no violation of principles of natural justice. The Petitioner has got the statutory alternative remedy of appeal. If so advised, the Petitioner can seek such an alternative remedy in accordance with the law. Hence, the writ petition was dismissed.

Conclusion: The Andhra Pradesh High Court’s decision reinforces that an assessee’s non-appearance during a GST hearing, when provided an opportunity, does not infringe upon the principles of natural justice. The court emphasized the importance of availing statutory remedies and dismissed the writ petition.

FULL TEXT OF THE JUDGMENT/ORDER OF ANDHRA PRADESH HIGH COURT

Heard learned counsel for the petitioner who appears through virtual mode and Sri T.C.D. Sekhar, learned Government Pleader for Commercial Tax appearing for respondents.

2. This writ petition under Article 226 of Constitution of India has been filed for the following relief:

“pleased to issue an appropriate writ, order or direction, more in the nature of Writ of Mandamus, setting aside the common orders under DIN: 3703082343770 dated 03.08.2023 passed by the Deputy Assistant Commissioner of State Tax, Gollapudi Circle, Vijayawada and to pass such other order or orders.”

3. Challenge is to the order dated 03.08.2023 passed under Section 74 of Goods and Services Tax Act (for short ‘GST Act’).

4. Preliminary objection has been raised that the order is appealable under the GST Act. Consequently, the writ petition deserved not to be entertained.

5. Learned counsel for the petitioner does not dispute that the order is appealable under Section 107 of GST Act but he submits that there is violation of the principles of natural justice, and as such this petition deserves to be entertained. He submits that in the show cause notice dated 27.05.2023, there is mention that the letter was sent to NAHI vide reference 6th cited i.e., dated 14.03.2023 for passing of tollgate data and pursuant thereto the data was received from them. He submits that the same is the basis of the show-cause notice and for passing the impugned order but the report or the information so received from NAHI was not supplied to the petitioner.

6. Learned counsel for the petitioner further submits that there is violation of principles of natural justice at the stage of providing personal hearing as well, in as much as firstly the notice for personal hearing dated 12.07.2023 fixing the date 17.07.2023 was served on 17.07.2023 i.e., the date of personal hearing. Consequently, the petitioner could not appear on that date. Secondly, the respondent issued another notice dated 21.07.2023 for personal hearing fixing the date 24.07.2023, but the petitioner could not appear for the reason that 22.07.2023 and 23.07.2023 were Saturday and Sunday and the time was not sufficient to make personal appearance.

7. In response, Sri T.C.D.Sekhar, learned Government Pleader submits that details of date received from NAHI were disclosed in the show-cause notice itself, at page No.69. He submits that even if the copy of the information received from NAHI, might not have been provided, but, since the contents thereof were disclosed in the show-cause notice itself, there is no violation of the principles of natural justice.

8. Sri T.C.D.Sekhar, learned Government Pleader further submits with respect to the personal hearing, that inspite of the second notice for personal hearing on 21.07.2023 by which 24.07.2023 was fixed, the petitioner did not appear, though the petitioner is at Vijayawada and the place for personal hearing was also at Vijayawada. There is no valid justification for not availing the opportunity of the personal hearing.

9. Considering the aforesaid submissions, we find that even if the copy of the information received was not supplied but the contents thereof were disclosed in the show-cause notice, there would be no violation of the principles of natural justice as the material was disclosed to the petitioner. The petitioner had also submitted the reply to the show-cause notice on 07.07.2023. On consideration of the petitioner’s reply, the impugned order was passed.

10. So far as the submission with respect to the violation of principles of natural justice of providing opportunity of personal hearing is concerned, the notice dated 21.07.2023 was given to the petitioner fixing the date 24.07.2023(Monday). It could not be demonstrated before us as to why the petitioner did not appear on the date fixed. The explanation of Saturday and Sunday is not for the date fixed. We find that the petitioner had no justifiable reason for not appearing for personal hearing on the date fixed. If a person does not avail the opportunity of personal hearing, he cannot later on complain about the same. On this aspect also we find that there is no violation of principles of natural justice.

11. The petitioner has got the statutory alternative remedy of appeal. If so advised, the petitioner can seek such alternative remedy in accordance with law.

12. The writ petition is dismissed on the aforesaid ground.

No orders as to costs.

As a sequel thereto, miscellaneous petitions, if any pending, shall also stand closed.

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