GST authorities must provide a personal hearing before passing an adverse assessment order under Section 75(4).

The petitioner challenged an assessment order dated 29 August 2024 for the financial year 2019–2020.

After receiving a show-cause notice dated 3 August 2022, the petitioner sought an extension of time to reply by communication dated 8 May 2023.

The respondent did not grant the extension in writing.

The petitioner also alleged that no personal hearing was provided before the order was made.

The respondent contended that the petitioner had nearly two years to submit a reply before the order was passed.

The petitioner stated that it had paid more than 50% of the disputed tax and was willing to pay an additional 10% to secure release of the bank attachment.

Whether the assessment order was liable to be set aside because the respondent did not provide the petitioner a personal hearing before making an adverse order.

Whether the petitioner was entitled to remand for fresh consideration and relief from the bank-account attachment, subject to payment of additional disputed tax.

Section 75(4) of the GST Act, 2017 requires the tax authority to afford an opportunity of personal hearing before passing an adverse order.

Failure to provide that hearing violates the statutory requirement and the principles of natural justice.

The Court accepted the respondent’s submission that the petitioner had sufficient time to file a reply between issuance of the show-cause notice and the assessment order, and therefore found no fault in the respondent’s failure to grant the requested extension.

However, the respondent had not afforded the petitioner a personal hearing before passing the adverse assessment order. That omission contravened Section 75(4) and the principles of natural justice, warranting the order’s setting aside and a fresh determination after hearing the petitioner.

The Court also granted conditional relief from the bank-account attachment in view of the petitioner’s undertaking to pay an additional 10% of the disputed tax.

The petitioner was directed to file its reply and supporting documents within three weeks of receiving the order; the respondent must then issue 14 days’ clear notice fixing a personal hearing and decide the matter on its merits and in accordance with law.

The bank-account attachment was to be lifted upon payment of the additional 10% of the disputed tax and production of proof of payment; the property attachment was to remain in place until a fresh assessment order, subject to the petitioner seeking its removal from the authority.

The writ petition was disposed of without costs.