Facts of the Case

The petitioner, Shakumbari Engineering Work, challenged an order dated 27.12.2023 passed under Section 73 of the Uttarakhand Goods and Services Tax Act, 2017 by the Assistant Commissioner, as well as a further order dated 15.05.2025 passed by the appellate authority (Respondent No. 2). The petitioner's grievance was that no opportunity of personal hearing had been afforded before the Section 73 demand was raised, in breach of the mandatory procedural safeguard built into the adjudication scheme. The State's counsel fairly conceded, on instructions, that no personal hearing had in fact been granted, and pointed out that the issue was already squarely covered by a prior Coordinate Bench ruling of the same High Court dated 05.06.2025 in WPMB No. 316 of 2025, M/S Sri Sai Vishwas Polymers vs. Deputy Commissioner, which had set aside a similar order on identical grounds.

Issues Involved

  1. Whether an order under Section 73 of the UKGST Act, 2017 can be sustained when passed without affording the assessee an opportunity of personal hearing.
  2. Whether the Appellate Authority's order, passed without curing this defect, could stand.
  3. Whether the matter was squarely covered by the Coordinate Bench decision in M/S Sri Sai Vishwas Polymers.

Petitioner's Arguments

  • No personal hearing was granted before the Section 73 order was passed, violating principles of natural justice.
  • The mandate and scheme of the GST Act itself stood violated by the assessing authority.
  • The issue was already conclusively settled by the Coordinate Bench in M/S Sri Sai Vishwas Polymers, which held that no order affecting civil rights can be passed without a hearing.

Respondent's Arguments

  • The State counsel candidly admitted, on instructions, that no personal hearing had been afforded to the petitioner before the impugned order was passed.
  • The State did not seriously contest the applicability of the earlier Sri Sai Vishwas Polymers ruling to the facts of this case.

Court Order / Findings

  • The Court held that the Appellate Authority had failed to appreciate the settled legal position that no order affecting the civil rights of a citizen can be passed without an opportunity of hearing.
  • Relying on Sri Sai Vishwas Polymers, the Bench found that the mandate and scheme of the GST Act had been violated by the concerned authorities.
  • The writ petition was allowed and the impugned order dated 27.12.2023, along with the appellate order dated 15.05.2025, was set aside.
  • The matter was remitted to the appellate authority to reconsider it afresh, in accordance with law.

Important Clarification

  • Personal hearing is a mandatory procedural safeguard before any adverse order under Section 73 of the GST Act is passed, irrespective of whether it is explicitly requested.
  • An appellate authority cannot cure or ignore a natural-justice defect in the original adjudication order; it must itself ensure the mandate of the Act is followed.
  • Coordinate Bench rulings on identical facts are binding and can lead to summary disposal of similar writ petitions without fresh adjudication on merits.

Sections Involved

  • Section 73, UKGST Act, 2017 — demand for tax not paid/short paid for reasons other than fraud or wilful misstatement.
  • Uttarakhand Goods and Services Tax Act, 2017 — the State enactment mirroring the CGST Act for intra-state supplies in Uttarakhand.
  • Section 107, CGST Act, 2017 (implicit, appellate jurisdiction) — governs the appeal against orders passed by adjudicating authorities.

Decision – In Favour of

The decision is in favour of the assessee (Shakumbari Engineering Work). The impugned demand and appellate orders were quashed on natural-justice grounds and the matter remanded for fresh consideration after a proper hearing.

Case Details

High Court of Uttarakhand at Nainital; Writ Petition No. 798 of 2025 (M/B); Coram: Hon'ble Ravindra Maithani, J. and Hon'ble Alok Mahra, J.; Order dated 26.09.2025.

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