Facts of the Case

The petitioner, TSN Old Iron Scrap Merchants, challenged a common order dated 03.08.2023 (DIN 3703082343770) passed under Section 74 of the Goods and Services Tax Act by the Deputy Assistant Commissioner of State Tax, Gollapudi Circle, Vijayawada, raising a disputed tax demand of Rs. 30,24,775, penalty of Rs. 62,03,232 and interest of Rs. 1,06,992. The show-cause notice dated 27.05.2023 referred to tollgate data obtained from the National Highways Authority pursuant to a letter dated 14.03.2023, which formed part of the basis for the demand; the petitioner contended this underlying data was never separately supplied to it. The petitioner also complained that notices for personal hearing were served too late to allow attendance — a first notice dated 12.07.2023 fixing 17.07.2023 was served only on the hearing date itself, and a second notice dated 21.07.2023 fixing 24.07.2023 left insufficient time given the intervening weekend. The department countered that the contents of the tollgate data were disclosed within the show-cause notice itself, and that the petitioner had no valid reason for non-appearance on 24.07.2023, a normal working day.

Issues Involved

  1. Whether non-supply of the underlying tollgate data (as opposed to its contents being described in the show-cause notice) amounted to a breach of natural justice.
  2. Whether the timing of the two personal-hearing notices deprived the petitioner of a real opportunity of hearing.
  3. Whether the writ petition should be entertained despite the availability of a statutory appeal under Section 107.

Petitioner's Arguments

  • The underlying data/report received from the highway authority, being the basis of the show-cause notice and impugned order, was never supplied to the petitioner, violating natural justice.
  • The first personal-hearing notice was served on the very date fixed for hearing, and the second notice left insufficient time due to an intervening weekend, denying real opportunity of hearing.

Respondent's Arguments

  • The contents of the tollgate data were disclosed within the show-cause notice itself, so non-supply of the underlying document caused no prejudice.
  • Despite the second notice fixing a working Monday (24.7.2023) with adequate notice, the petitioner did not appear and offered no valid justification; a party who fails to avail a hearing opportunity cannot later complain of its denial.

Court Order/Findings

  • The Court held that disclosure of the contents of third-party data within the show-cause notice itself satisfies natural justice even without supplying the underlying document, and found no violation on that count.
  • On the hearing-notice issue, the Court held the petitioner had no justifiable explanation for non-appearance on 24.7.2023 (a working Monday, with the Vijayawada venue accessible), and that a party who does not avail an offered hearing cannot complain of denial of natural justice.
  • Finding no violation of natural justice, and noting the availability of the statutory appellate remedy under Section 107, the Court dismissed the writ petition, leaving the petitioner free to pursue the statutory appeal.

Important Clarification

  • Non-supply of an underlying third-party document (such as toll/vehicle-movement data) does not by itself breach natural justice where its substantive contents have already been disclosed in the show-cause notice.
  • A taxpayer who fails, without justifiable cause, to avail a properly notified personal hearing cannot later invoke natural justice to challenge the resulting order.

Sections Involved

  • Section 74, CGST Act, 2017 – determination of tax not paid/short paid or ITC wrongly availed by reason of fraud, wilful misstatement or suppression.
  • Section 107, CGST Act, 2017 – appeals to the appellate authority.

Decision – In Favour of

The decision favours the department – the writ challenge to the Section 74 order was dismissed on the natural-justice grounds raised, with the petitioner relegated to the statutory appellate remedy.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Andhra Pradesh at Amaravati
  • Case No.: WRIT PETITION NO: 32206 OF 2023
  • CNR: Not available
  • Coram: Hon'ble Sri Justice Ravi Nath Tilhari and Hon'ble Sri Justice A. V. Ravindra Babu
  • Decision Date: 15.12.2023
  • Disposal Nature: Dismissed (relegated to statutory appeal under GST Act)

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