GST: Denial of Effective Hearing a Violation of Justice, Gujarat HC

The non-granting of the effective hearing would be a total breach of natural justice, Gujarat High Court observed.

The petitioner contested the ex-parte decision made by the Commissioner of Central GST and Central Excise, which was purportedly made without consulting the petitioner or its authorized representatives and in a flagrant breach of natural justice principles.

Applicant– M/s Gyscoal Limited, is a company incorporated under the Companies Act., to manufacture their final goods i.e. products of stainless Steel that come under Chapter 72 of the Central Excise Tariff Act (CETA), the other applicant, Viral Shah is the Director of Gyscoal Ltd, Prakash Singh Solanki is the employee of Gyscoal Limited and Rest Petitioners i.e. Tvisha, Magna Vision, and Superfine are the suppliers of raw material to the Gyscoal Ltd.

The whole Show Cause Notice is based on the statements that were recorded under Section 14 of the Central Excise Act, and the challenged judgment validated the demand for M/s Gyscoal Ltd on the basis of those statements that were not submitted to cross-examination.

The only time a personal hearing was available was during a state of emergency. The final hearing of the show-cause notice dated did not occur, and the hearing record referencing just the final hearing of the show-cause notice was returned for correction by the petitioner’s attorney. It is claimed in this record that only one show cause notice was the subject of the hearing.

“All the hearings were granted physical hearing that too during the complete lockdown and the last hearing was a virtual hearing granted only to main notice with respect to only one show cause notice and notice had sent the correction in the record of personal hearing, which is not taken on record.” The Bench of Sonia Gokani, a Chief Justice (Designate), and Justice Sandeep N Bhatt, observed.

The Court further pointed out that at the time notice was given, a reference had been made to the denial of cross-examination, and that this was against the rules of natural justice. Following the petitioners’ hearing, the Court determined that an effective personal hearing was also denied, resulting in a total violation of natural justice.

The Court reached the conclusion that denying a person an effective hearing would be a flagrant breach of natural justice.

Case TitleGyscoal Alloys Ltd. & Ors. Versus Union of India & Anr
CitationC/SCA/2542/2021
Date15.02.2023
AppearanceMr Hemant G. Dharmadhikari, Advocate
Ms Lalita S. Phadke & Mr Dhaval Shah, Advocates
RespondentMr Dhaval D Vyas
Gujarat High CourtRead Order
Arpit Kulshrestha

Arpit Kulshrestha seeks higher interests in financial services, taxation, GST, I-T, etc. Writes articles with depth knowledge and is extensive for the same. The resources provide effective articles for the products of SAG infotech which provides taxation and IT software. Writing from observations and researching makes his articles virtuous.

Recent Posts

No GST Returns Will Be Accepted If Filed More Than 3 Years Past Their Due Date

An advisory has been released by the Goods and Services Tax Network (GSTN) which notifies…

10 hours ago

Delhi HC: Two Judgment Orders Against One SCN Cannot Be Accepted for the Same Period

It was cited by the Delhi HC that the two adjudication orders against one SCN…

12 hours ago

CBDT Allows Electronic Filing of Forms 3CEDA and 3C-O Via Notification No. 5/2024

The Central Board of Direct Taxes (CBDT) in an update for the taxpayers via the…

13 hours ago

October 2024 Records the 2nd Highest GST Collection, Driven by Domestic Sales

In October, Gross GST collection surged to 9% to Rs 1.87 lakh crore, the second…

15 hours ago

UP AAR: GST Will Be Levied on the Installation of Electricity Distribution Systems by DISCOMs

Goods and Services Tax (GST) is to get paid on the procurement of materials and…

2 days ago

Bombay HC Quashes Rejection Order for Voluntary GST Cancellation Due to Lack of Stated Reasons

The Bombay High Court carried that as the revocation orders for the registration cancellation on…

3 days ago