GST Appellate Orders Cannot be Reserved and Pronounced Later without Notifying Assessee: Allahabad HC Calls Order ‘Unsustainable’ [Read Order]

The Allahabad High Court has held that GST ( Goods and Services Tax ) appellate orders cannot be reserved on one date and pronounced later without notifying or hearing the assessee, calling such an order legally unsustainable.

The fact is that a petition was filed by M/s Sun Glass Works Private Limited, a manufacturer of glass bottles, challenging the appellate order dated 25.09.2024 passed by the Additional Commissioner (Appeals), Mainpuri, as well as the original order dated 10.05.2022.

The petitioner contended that it had duly purchased raw materials from registered dealers and had submitted all supporting documents including tax invoices, bank statements and GSTR-2A in response to a show-cause notice issued under Section 74(1) alleging wrongful ITC availment.

Despite this, the assessing authority passed the order dated 10.05.2022 without supplying the alleged survey report or granting any opportunity of personal hearing, resulting in tax and penalty demands.

Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here

The appeal filed against the order proceeded in the same manner on 18.09.2024, the date fixed for hearing, the appellate authority reserved the judgment and subsequently delivered it on 25.09.2024 without issuing any notice to the petitioner.

The petitioner argued that the GST Act contains no provision permitting authorities to reserve orders and pronounce them later in the absence of any communication to the assessee.

The counsel of the petitioner, Adv. Vishwjit, noted the Court’s earlier judgment in M/s Wonder Enterprises v. Additional Commissioner, Grade-2.

The Bench Court noted that even in the personal affidavit filed by the appellate authority, no statutory provision or notification was cited to justify reserving the judgment and delivering it later without informing the taxpayer.

Justice Piyush Agarwal observed that the issue was squarely covered by the precedent in Wonder Enterprises as mentioned by the petitioner. It was held that such a practice deprived the petitioner of procedural safeguard and was contrary to the principles of natural justice.

Since the order had been passed on a date when the petitioner was neither notified nor heard, it could not be sustained.

Accordingly, the High Court quashed the appellate order dated 25.09.2024 and remanded the matter to the Additional Commissioner (Appeals), Mainpuri for a fresh decision.

By allowing the petition, the authority has been directed to decide the matter de novo after giving due opportunity of hearing to all stakeholders.

Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates