Opportunity of Hearing Mandatory before Passing GST Orders

Case Title: Raghu Bansha Maurya v. The Assistant Commissioner Bally & Ors.
Court: High Court at Calcutta (Constitutional Writ Jurisdiction, Appellate Side)
Petition No.: WPA 19798 of 2024
Date of Judgement: 23.09.2024
Category of Dispute: Natural Justice / Opportunity of Hearing in Adjudication
Relevant Sections: Section 74 & Section 75(4) of WBGST/CGST Act, 2017

Facts of the Case (Ref: Para 2–4)

• The petitioner challenged an adjudication order dated 3rd April 2024 under Section 74 of the CGST/WBGST Act for the tax period August 2020.

• A show cause notice in DRC-01 was issued on 1st February 2024.

• The grievance was that no personal hearing was granted before passing the order, which was in violation of Section 75(4) of the Act.

• The State’s counsel admitted that no hearing was afforded to the petitioner.

Question(s) in Consideration (Ref: Para 3–5)

• Whether an opportunity of personal hearing is mandatory under Section 75(4) before passing an adverse adjudication order under Section 74, irrespective of a written request by the taxpayer?

Observation of the Court (Ref: Para 5–6)

• Section 75(4) mandates that an opportunity of hearing must be given if an adverse decision is contemplated.

• This requirement applies even if the taxpayer has not specifically requested for a hearing.

• Since no hearing was given, the order dated 3rd April 2024 was held to be vitiated due to violation of statutory provisions.

Judgement of the Court (Ref: Para 6–10)

• The order dated 3rd April 2024 under Section 74 for the tax period August 2020 was set aside.

• The matter was remanded to the proper officer for fresh adjudication.

• The officer was directed to grant an opportunity of hearing and pass a reasoned order within 16 weeks from the communication of the judgment.

• Writ petition was disposed of accordingly.

Between Fine Lines

• GST authorities must mandatorily provide personal hearing before passing adverse orders.

• Failure to follow Section 75(4) makes the order legally unsustainable.

• Taxpayers do not need to apply in writing for such a hearing.

• Courts are consistently setting aside orders passed without hearings.

• Proper officers are being directed to readjudicate with compliance to natural justice.

Summary of Referred Cases

(No external precedents were cited in this judgment; hence no referred cases table is applicable.)

Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”