Since ages, it has been the Law that officers must follow the principle of natural justice by allowing taxpayers / assesses an opportunity of being heard if they complete assessments against them. Section 73(1) and 74(1) of the CGST Act, provides to issue a show cause notice by tax officers in case of any short payment of tax, etc. by taxpayers. This is a basic approach one sitting in power must follow before concluding a matter. Officers must appreciate the documents/information/evidence taxpayers can produce before them. There is always a scope for less litigation, provided an appreciated legal process is followed.
A similar question came before the Honorable High Court of Madras where the petitioner filed a petition for an irregular impugned order issued by the officer without having heard the petitioner in person. The court sets aside the impugned order stating “ The sum and substance of Section 75(4) is that a personal hearing shall be granted in all matters prior to finalisation of assessment except where the stand of the assessee is intended to be accepted by the Department. Thus, on this score, the officer has grossly erred in proceeding to finalise the impugned assessment in violation of the principles of natural justice”.
SW Point of View:
The principle of natural justice is not a new practice. One must follow it. Not doing it may lead to unnecessary harassment of taxpayers and they may end up spending extra costs and efforts in seek of relief.
Amandeep Singh Oberoi, Senior Manager- Indirect Tax, SW India
