Order Date – 25 August 2023

Parties: M/S Dana Pani Vs State of U.P. and Another

Facts – 

• The petitioner, M/S Dana Pani, was issued with a notice in the proceedings in 06.04.2021 seeking his reply within 30 days.
• It was submitted that the petitioner was completely denied opportunity of oral hearing before the Assessing Authority as the Assessing Authority had at that stage itself chosen to not give any opportunity of hearing to the petitioner by mentioning "NA" against column description "Date of personal hearing". Similar endorsements were made against the columns for "Time of personal hearing" and "Venue where personal hearing will be held".

Issue – 

• Whether the denial of an opportunity of oral hearing to the petitioner was in violation of Section 75(4) of the CGST Act?

Order – 

• The Divisional Bench of Hon’ble High Court observed that once it has been laid down by way of a principle of law that a person/assessee is not required to request for "opportunity of personal hearing" and it remained mandatory upon the Assessing Authority to afford such opportunity before passing an adverse order, the fact that the petitioner may have signified 'No' in the column meant to mark the assessee's choice to avail personal hearing, would bear no legal consequence.
• Principle of natural justice would commend to this Court to bind the authorities to always ensure to provide such opportunity of hearing. It has to be ensured that such opportunity is granted in real terms. Here, the impugned order itself has been passed on 23.03.2022. The stand of the assessee may remain unclear unless minimal opportunity of hearing is first granted. Only thereafter, the explanation furnished may be rejected and demand created.
• Not only such opportunity would ensure observance of rules of natural of justice but it would allow the authority to pass appropriate and reasoned order as may serve the interest of justice and allow a better appreciation to arise at the next/appeal stage, if required.
• Accordingly, the present writ petition is allowed. The matter is remitted to issue a fresh notice to the petitioner.