The Patna High Court (HC) ruled that Ex parte assessment order passed in violation of principles of natural justice, entails civil consequences.
The petitioner, Pravin Kumar approached the High Court for the issuance of a writ in the nature of Certiorari or any other appropriate writ or order for quashing of the order passed by the respondent No. 2, the Additional Commissioner of State Taxes (Appeal), whereby the appeal of the petitioner was dismissed.
The petitioner further urged the Court to quash the ex-parte assessment order and the consequential demand notice contained in Form GST DRC-07 levying tax amounting to Rs. 1 crore along with interest and penalty for the Financial Year 2018-19, and further be pleased to direct the respondents to remove the attachment of the bank account of the petitioner.
The Counsel for the Revenue submitted that there is no objection if the matter is remanded to the Assessing Authority for deciding the case afresh and the limitation shall not be allowed to come in the way. Also, the case shall be decided on merits. Also, during pendency of the case, no coercive steps shall be taken against the petitioner.
A Bench comprising Chief Justice Sajay Karol and Justice Partha Sarthy observed that “We form an opinion that the order is bad in law. This we say so, for two reasons- (a) violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was afforded to the petitioner to represent his case(b) order passed ex parte in nature, does not assign any sufficient reasons even decipherable from the record, as to how the officer could determine the amount due and payable by the assessee.”
The Bench ruled that “The order, ex parte in nature, passed in violation of the principles of natural justice, entails civil consequences” and also directed the Assessing Authority to decide the case on merits after complying with the principles of natural justice.
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