GST Act Empowers Proper Officer To Grant Upto Three Adjournments If Sufficient Cause Is Shown: Delhi High Court

The Delhi High Court has held that, as per Section 75(5) of the GST Act, if sufficient cause is shown, the proper officer shall adjourn the hearing; however, not more than three adjournments may be granted.

The bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja has observed that, in terms of Section 75(5) of the Act, three adjournments may be granted, but it is not mandatory for the proper officer to grant three adjournments. Adjournment is not a right. Said provisions empower the proper officer to grant up to three adjournments if sufficient cause is shown. It would be dependent on the facts of each case whether sufficient cause has been shown or not for the exercise of the discretion to adjourn.

The petitioner/assessee has impugned the order by which the Show Cause Notice proposing a demand of Rs. 15,19,68,460 against the petitioner has been disposed of and a demand including a penalty has been raised against the petitioner.

As per the Show Cause Notice, the Department has given reasons under separate headings, i.e., excess claims of input tax credit (ITC). Scrutiny of ITC availed and under declaration of ineligible ITC.

The petitioner contended that it had replied to the Show Cause Notice, seeking additional time for furnishing a detailed reply and an opportunity for a personal hearing. A reminder was issued to the petitioner, providing a final opportunity for a personal hearing. The petitioner had replied to the reminder, seeking time to furnish a reply and time to appear for a personal hearing. However, the order does not take into consideration the request submitted by the petitioner for an extension of time and is a cryptic order.

The petitioner contended that, according to Section 75(5), the petitioner is liable for the grant of adjournment of personal hearings up to three times. However, despite the petitioner seeking time for personal hearings, the petitioner was not provided with the opportunity for a personal hearing, which is against the principles of natural justice.

The department contended that no detailed reply was filed by the petitioner, and despite two opportunities granted to the petitioner, the petitioner failed to file a detailed reply or appear in person.

Counsel For Petitioner: Anjali Jha Manish

Counsel For Respondent: Rajeev Aggarwal

Case Title: Sun & Sand Industries Africa Pvt. Ltd Versus Sales Tax Officer Class-Ii/Avato Department Of Trade And Taxes

Citation: 2024 LiveLaw (Del) 515

Case No.: W.P.(C) 5670/2024 & CM APPL. 23433/2024

Click Here To Read The Order