Failure To Comply Provision Of Sec 75(4) Of CGST Act 2017 Vitiates Entire Order: Calcutta High Court

The Calcutta High Court held that failure to comply with statutory provision which mandates consideration of explanation on the part of assessee before passing adverse order, vitiates such order. The High Court held so while considering that the petitioner was prevented from filing his response to the show cause notice, due to a reasonable cause. Referring to Section 75(4) of the CGST/WBGST Act, 2017, Single Bench of Justice Raja Basu Chowdhury observed that “affording an opportunity of hearing is mandated where a request is received in writing from the person chargeable with tax, or penalty or where any adverse decision is contemplated against such person”. Facts of the case The petitioner/ assessee had approached the Writ Court complaining that although a show cause notice was served on the petitioner in Form GSTDRC-01, however, despite permitting the petitioner to submit his response, the Department/ Respondent passed an order without affording sufficient opportunity of hearing. Observations of the High Court The Bench referred to the submission of counsel for assessee that the petitioner could not file his response within the time specified being unwell. On such reference, the Bench accepted that since the statute recognizes a right for the assessee to be afforded with an opportunity of personal hearing when the Department contemplate passing of an adverse order, failure to offer such opportunity to the assessee tantamount to failure of complying with statutory provision. The Bench also admitted that the final order passed by the proper officer under Section 73 of the Act in absence of proper hearing is not maintainable. Even though the petitioner was duly served with a show cause notice in Form GSTDRC01, the petitioner failed to file any response to the same, on account of being not well, for which medical prescriptions were also attached, added the Bench. Since adverse decision was contemplated against the petitioner, the High Court remanded the matter back to the proper officer, with a direction to re-adjudicate the issues involved in the show-cause upon giving an opportunity of personal hearing to the petitioner or his authorized representative. Counsel for Appellant/ Assessee: Debasish Ghosh and Partha Sen Counsel for Respondent/ Revenue: Anirban Ray, T. M. Siddiqui, Tanoy Chakraborty, Saptak Sanyal, S. Shaw, Vipul Kundalia and Smita Das De Case Title: Arup Mallick versus Commissioner, Commercial Taxes and State Tax, & Ors. Case Number: WPA 15853 of 2024 Click here to read/ download the Order

Failure To Comply Provision Of Sec 75(4) Of CGST Act 2017 Vitiates Entire Order: Calcutta High Court

Pankaj Bajpai

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