In Writ Petition No. 6119 of 2020 -MP HC- Madhya Pradesh High Court rules Section 75 of GST Act is a complete code in itself, failure to provide reasonable opportunity to Assessee vitiates the end result
Justice Sheel Nagu & Justice Hirdesh [10-05-2023]

Read Order: M/S Balaji Electricals V. Commissioner State Tax Sagar Division Sagar and Ors

Chahat Varma

New Delhi, June 21, 2023: The Madhya Pradesh High Court has ruled that Section 75 of the Goods and Services Tax Act (GST Act) is a complete code in itself, ensuring that the assessee is given a reasonable opportunity to be heard. The court emphasized that the statute itself mandates the provision of a reasonable opportunity, and it is the responsibility of the Revenue to ensure this opportunity is provided and failure to provide such an opportunity vitiates the end result.

In the matter at hand, the petitioner argued that the show cause notice lacked clarity as it failed to communicate the necessary information and materials, thereby preventing the petitioner from providing a proper response. Consequently, it was contended that all subsequent actions, including the order and the dismissal of the appeal, were vitiated in law. The counsel representing the State, referring to the Return and Additional Return, argued that the reply provided by the petitioner to the show cause notice indicated that the petitioner was not hindered in providing a response despite the alleged vagueness of the notice. The State's counsel also highlighted that the ground of the show cause notice being vague was not raised in the appeal memo.

The bench of Justice Sheel Nagu and Justice Hirdesh acknowledged that the petitioner did not specifically raise the ground of vagueness before the appellate authority. However, it emphasized that the mandatory provisions of the GST Act impose a responsibility on the Revenue to issue a show cause notice that is sufficiently clear and informative, enabling the assessee to respond effectively.

Based on the decision in the case of M/s. Sidhi Vinayak Enterprises v. The State of Jharkhand and Ors [LQ/JharHC/2023/45], the bench concluded that the initiation of the proceedings through the show cause notice was rendered invalid due to its vagueness.