GST Act requires personal hearing either on request, or when adverse order is contemplated

GST Act mandates personal hearing to be given to the party, either on written request, or against whom an adverse order is contemplated

In a recent judgment, Hon’ble High Court of Uttarakhand has held that the scheme of the GST Act 2017 mandates that, in either of the two circumstances, a personal hearing is required to be given to the party, who either makes a written request, or against whom the authorities contemplate an adverse order.

ABCAUS Case Law Citation:
4795 (2025) (10) abcaus.in HC

In the instant case, the assessee by way of a Writ Petition sought quashing of the order passed by the under section 73 of the GST Act.

The petitioner contended that the Notice was never received by the petitioner and the order impugned had been passed in violation of the Principle of Natural Justice without affording any opportunity of hearing to the petitioner. The petitioner submitted that the issue involved in the Writ Petition was covered by the Order passed by the Court.

It was observed that a Coordinate Bench of the Court had held that under the provisions of Section 75 of the CGST Act, one prerequisite is that the Assessing Authority is required to afford an opportunity of personal hearing, where it is requested by the Assessee in writing, or where any adverse decision is contemplated against such person, meaning thereby that the Assessing Authority is required to comply with the mandate of sub-section (4) of Section 75 in either of the two circumstances, i.e. where a request for personal hearing is made and specifically sought for in writing, or where an adverse decision is contemplated against such person.

The Hon’ble High Court further noted that in the instant case, the Assessing Officer had drawn conclusions adverse to the interest of the petitioner, and that being the undisputed fact, the Assessing Authority was required to afford an opportunity of personal hearing, even in the absence of a written request.

The Hon’ble High Court observed that it is needless to say that, when the law requires a thing to be done in a particular manner, the said act shall be performed in the said manner alone, or not at all. Law in this regard is no more res integra, and is well-settled by catena of judgments of the Hon’ble Apex Court. The High Court noted that a similar view was taken by the Hon’ble Supreme Court holding that whenever a statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to a specific consequence, it would be difficult to hold that the requirement is not mandatory and the specified consequence should not follow.

The Hon’ble High Court further observed that the scheme of the Act mandates that, in either of the two circumstances, a personal hearing is required to be given to the party, who either makes a written request, or against whom the authorities contemplate an adverse order. In the case on hand, the latter part was applicable, and the Assessing Authority ought to have complied with the mandate of sub-section (4) of Section 75 of the CGST Act.

The Hon’ble High Court stated that the Appellate Authority failed to appreciate that the order impugned, results in civil consequences, and any proceedings, which results in civil consequences to the petitioner, are required to be passed after affording an opportunity of hearing. In the case of CGST Act, the Act itself, and in particular sub-section (4) of Section 75, mandates that an opportunity of personal hearing ought to be given to the parties concerned, more so when the authorities contemplate an order adverse to the interest of the assessee.

The Hon’ble High Court held that the Appellate Authority had failed to appreciate the settled position in law that no order, affecting civil rights of a citizen, can be passed without affording an opportunity of hearing, and also failed to appreciate the fact that the mandate, and the scheme of the Act itself, had been violated by the concerned authorities.

Accordingly, the orders impugned were set-aside. The matter was remitted back to the competent Authority to proceed afresh from the stage of the Notice.

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