GST Registration Cancellation order Quashed for Violation of Natural Justice: High Court Upholds Right to Hearing
Summary in Key Points:
- Issue: The assessee challenged the cancellation of their GST registration under Section 23 and an order passed under Section 161, alleging a violation of natural justice.
- Violation: The authorities canceled the registration without granting the assessee an opportunity for a personal hearing.
- Decision: The High Court, citing the precedent set in Mahaveer Trading Company v. Deputy Commissioner, quashed the impugned orders and remanded the matter back to the authorities.
- Principle: The court emphasized the importance of granting a personal hearing before passing any adverse order affecting a taxpayer’s rights.
HIGH COURT OF ALLAHABAD
Kesh Babu Construction Company
v.
State of U.P.
Shekhar B. Saraf and Vipin Chandra Dixit, JJ.
WRIT TAX No. – 2278 of 2024
DECEMBER 16, 2024
Rishi Raj Kapoor for the Petitioner.
ORDER
1. Heard learned counsel appearing on behalf of the parties.
2. This writ petition has been filed for the following relief:-
“I. Issue a suitable writ, order or direction in the nature of certiorari for quashing the impugned order dated 29.12.2023 passed by the respondent no.2 under section 23 of the UPGST/CGST Act for the tax period of July 2017 to March 2018, F.Y. 2017-2018 and order dated 27.6.2024 passed by the respondent no.2 under section 161 of the U.P.GST Act, 2017 (Annexure-1 to the writ petition.
II. Issue a suitable writ, order or direction in the nature of certiorari for quashing the notice dated 25.8.2022 issued by respondent no.2 [Annexure no.2].”
3. Applying the ratio as laid down by the coordinate Bench of this Court in the case of Mahaveer Trading Company v. Deputy Commissioner State Tax and another [(Writ Tax No.303 of 2024), Neutral Citation No.-2024:AHC:38820-DB], we are of the view that opportunity of personal hearing should have been granted to the petitioner under Section 75(4) of the Uttar Pradesh Goods and Services Tax Act, 2017 before passing any adverse order against the petitioner.
4. In light of the same, the impugned orders dated December 29, 20223 and June 27, 2024 passed by respondent no.2/Deputy Commissioner, Sector-I, State Tax, Fatehpur are quashed and set-aside with a direction given to the officer concerned to grant the petitioner another opportunity of filing a fresh reply and thereafter fix a date of hearing and pass a reasoned order. The entire exercise should be completed within a period of two months from date.
5. The writ petition is disposed of.