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Characterizing it as ‘sketchy’ and ‘non-speaking’, Court sets aside the order of the Joint Commissioner: Rajasthan High Court

The Rajasthan High Court passed a judgement on 15-12-2022 in the case of Hindustan Construction Company Ltd. Vs. Union of India Civil Writ Petition No. 2478/2022. While dealing with the connected civil writ petitions challenging the interest and penalty imposed by the Joint Commissioner, State Goods and Services Tax (GST) on account of delayed payment of tax, The Division Bench of Sandeep Mehta and Kuldeep Mathur set aside the order of the officer due to violation of mandatory requirement of Section 75(6) of the Central Goods and Services Tax Act, 2017.

FACTS OF THE CASE:

The petitioner challenged for final assessment order on ground on non-adherence to the principles of natural justice as the orders, pursuant to the show cause notice, were passed without providing opportunity of hearing and without adverting to the petitioner’s assertions made in the reply. It was further contended that the non-speaking order was passed, thus, the order was liable to be set aside. The petitioner prayed for one opportunity to advance oral submissions qua the show cause notice and the Joint Commissioner be directed to pass a fresh reasoned order.

The respondent contended that the notice for personal hearing was duly dispatched and delivered to the petitioner’s representative who had appeared before the officer in May 2022 to submit the reply qua the show cause notice. It was further contended that the May 2022 order sheet too recorded the intimation to remain present for personal hearing, therefore, no separate notice was required to be issued anyway.

JUDGEMENT:

Since no one appeared for the personal hearing, the order was passed ex-parte. The respondent further submitted that the petitioner had delayed in depositing the tax amount and the notice was a direct legal consequence of that. Therefore, the demand for interest and penalty was justifiable.

The court concluded that the officer did not consider the reply filed by the petitioner, while passing the order characterizing it as sketchy and non-speaking on the face of it. The court while setting aside the order, asserted that it suffered from non-application of mind and was in violation of mandatory requirement of Section 75(6) of the CGST Act.

The petitioner was accordingly directed to appear before the Joint Commissioner on a set date, providing an opportunity of being heard, consequent to which fresh order to be passed assigning proper reasons.

The court had previously issued a show cause notice to the Joint Commissioner and had directed him to remain present in Court with the original dispatch register which was ultimately discharged.

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JUDGEMENT REVIEWED BY CHANDANA SHEKAR

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