Acknowledging the breach of natural justice, the Karnataka High Court set aside the impugned ex-parte order. The court directed the respondent to reconduct the appeal hearing.
In a significant ruling, the Karnataka High Court has set aside an ex-parte order issued by the Joint Commissioner of Commercial Tax (Appeals) after finding that the GST department failed to properly notify the petitioner of personal hearing dates via email, despite a clear request. Instead, notifications were issued solely through the GST portal, leading to a missed opportunity for the petitioner to present their case.
Case Background
The petitioner, Ebony Automobiles Pvt. Ltd., a private limited company registered under the CGST/SGST Act, had been issued an adverse order by the Assistant Commissioner of Commercial Taxes on August 31, 2023. Dissatisfied with this ruling, Ebony Automobiles filed an appeal to be reviewed by the Joint Commissioner of Commercial Tax (Appeals).
The department initially scheduled personal hearing dates on January 5 and January 30, 2024. However, the only communication provided was on the GST portal. On February 6, 2024, the petitioner formally requested that any future notifications be sent to their specified email address. This request was received by the department on February 7, 2024.
Failure to Notify Via Email Despite Explicit Request
Despite the petitioner’s formal request, subsequent notifications for hearing dates set for February 20 and March 1, 2024 were again posted on the GST portal only. As a result, the petitioner was unaware of the scheduled hearings and was unable to attend. Consequently, the respondent dismissed the appeal ex-parte on March 28, 2024, due to the petitioner’s absence.
Also Read: Delhi High Court Rules Against 2 Adjudication Orders for a Single Show Cause Notice
The petitioner then challenged this ex-parte order before the Karnataka High Court, arguing that the failure to notify them via their requested communication channel denied them the opportunity for a fair hearing.
Court’s Ruling: Emphasis on Principles of Natural Justice
Justice S.R. Krishna Kumar presided over the case, underscoring that the GST department’s failure to notify the petitioner via email amounted to a denial of natural justice. The court emphasized that by ignoring the petitioner’s specific request for email notifications, the respondent deprived them of a fair chance to appear and argue their case, violating the fundamental principle of ensuring fair hearings.
Outcome: Ex-Parte Order Set Aside; Fresh Hearing Ordered
Acknowledging the breach of natural justice, the Karnataka High Court set aside the impugned ex-parte order. The court directed the respondent to reconduct the appeal hearing, allowing the petitioner an opportunity to present their case. The petitioner was instructed to appear before the respondent on September 12, 2024, with no further notification required.
This case underscores the importance of adhering to communication preferences for personal hearings in tax-related appeals, highlighting the judiciary’s role in safeguarding procedural fairness under the CGST/SGST framework.
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