[GST] Decision-Making Procedure Adopted By Authority De Hors Provisions Of Act/Rules, Is Liable To Be Rendered As Flawed: Allahabad High Court
While directing that the order under Section 73 of the Goods and Service Tax Act, 2017 uploaded in the “Additional Notices and Tabs” on the GST portal be treated as the show cause notice, the Allahabad High Court observed that “If in a decision making procedure adopted by the authority is de hors the provisions of the act or rules framed thereunder, it is liable to be rendered...
While directing that the order under Section 73 of the Goods and Service Tax Act, 2017 uploaded in the “Additional Notices and Tabs” on the GST portal be treated as the show cause notice, the Allahabad High Court observed that
“If in a decision making procedure adopted by the authority is de hors the provisions of the act or rules framed thereunder, it is liable to be rendered as flawed one.”
Petitioner challenged the order under Section 73 of the GST Act on grounds of violation of principles of natural justice as no show cause notice was served upon the petitioner. It was argued that the petitioner came to know of the order only when it was uploaded in view “Additional Notices and Tabs” head in the GST portal.
Petitioner argued that as soon as it had knowledge of the order, it approached the appellate authority but the appeal was rejected. Before the High Court, petitioner argued that he was denied the opportunity of placing his stand due to insufficient service of notice. Further, it was argued that the petitioner was left remediless for want of knowledge of the notice and the order.
Justice Ajit Kumar observed that
“The court is of the considered view that statutes provide procedure either in their substantive provisions, or under the rules framed thereunder, to ensure that orders are not passed by the authorities whimsically, more especially where the authorities exercise power which is quasi judicial in nature or akin to that.”
It was held that once there is mandatory requirement of law to follow a specific procedure in decision making, the same must be followed. Any defect in following such procedure cannot be cured at a late stage, held the Court.
Accordingly, the Court directed that the order by the Assessing Authority under Section 73 be treated as show cause notice and the petitioner was directed to file a reply within 8 weeks.
Case Title: M/S Akriti Food Industry Llp v. State Of UP And 3 Others 2025 LiveLaw (AB) 8 [WRIT TAX No. - 2070 of 2024]
Case citation: 2025 LiveLaw (AB) 8
Counsel for Petitioner :- Akashi Agarwal, Rahul Agarwal