High Court Quashes GST Appellate Order Against Indian Oil Corporation for Violation of Natural Justice — Pre-deposit Requirement Set Aside. Failure to Provide Personal Hearing and Reasoned Order Renders Appellate Order Unsustainable Under Section 107(11) of CGST Act, 2017.

High Court: Karnataka High Court Bench: BENGALURU In Favour of Accused

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2026-05-18 11:43:44

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Case Note & Summary

The petitioner, M/s Indian Oil Corporation Ltd., a public sector undertaking engaged in storage and supply of petroleum products, filed a writ petition under Articles 226 and 227 of the Constitution of India seeking to quash the impugned order in Appeal No.100-101/2024/ADC-A1/GST dated 28.02.2024 passed by the Additional Commissioner of GST, Appeals-I, Bengaluru. The petitioner had filed an appeal before the appellate authority against an order of the Assistant Commissioner of Central Tax, South Division-1, Bengaluru. The appellate authority dismissed the appeal solely on the ground that the petitioner had not complied with the pre-deposit requirement. The petitioner contended that the impugned order was passed without granting a personal hearing and without assigning any reasons, in gross violation of the principles of natural justice and Section 107(11) of the Central Goods and Services Tax Act, 2017. The respondent argued that the appeal was rightly dismissed for non-compliance with pre-deposit. The court, after hearing both sides, observed that Section 107(11) of the CGST Act, 2017 mandates that no order in appeal shall be passed without giving the appellant an opportunity of being heard. The impugned order did not record any personal hearing nor did it contain any reasons for dismissal. The court held that the order was unsustainable and quashed it, remanding the matter to the appellate authority for fresh consideration in accordance with law, after providing a reasonable opportunity of hearing to the petitioner. The court also directed that the petitioner be permitted to comply with the pre-deposit requirement within a stipulated time.

Headnote

A) Constitutional Law - Writ of Certiorari - Violation of Principles of Natural Justice - Section 107(11) Central Goods and Services Tax Act, 2017 - The appellate authority dismissed the appeal for non-compliance with pre-deposit without granting a personal hearing and without passing a reasoned order - Held that the impugned order is in gross violation of principles of natural justice and Section 107(11) of the CGST Act, 2017, which mandates a personal hearing before dismissal - The order was quashed and the matter remanded for fresh consideration (Paras 2-5).

Issue of Consideration

Whether the impugned appellate order dated 28.02.2024 passed by the Additional Commissioner of GST, Appeals-I, Bengaluru, dismissing the petitioner's appeal for non-compliance with pre-deposit without providing a personal hearing and without a speaking order, is sustainable in law.

Final Decision

The writ petition is allowed. The impugned order dated 28.02.2024 passed by the Additional Commissioner of GST, Appeals-I, Bengaluru is quashed. The matter is remanded to the appellate authority for fresh consideration in accordance with law, after providing a reasonable opportunity of hearing to the petitioner. The petitioner is permitted to comply with the pre-deposit requirement within a period of four weeks from the date of receipt of a copy of this order.

Law Points

Natural justice
personal hearing
reasoned order
pre-deposit
appeal dismissal
Section 107(11) CGST Act
2017
writ of certiorari
violation of principles of natural justice

Case Details

NC: 2024:KHC:33454

WP No. 14414 of 2024 (T-RES)

2024-08-20

S.R.Krishna Kumar

NC: 2024:KHC:33454

Sri. V Raghu Raman (Senior Counsel) a/w Sri. Raghavendra C.R. (Advocate) for petitioner; Sri. Jeevan J. Neeralgi (Advocate) for respondent

M/s Indian Oil Corporation Ltd.

The Assistant Commissioner of Central Tax, South Division – 1, Bengaluru.

Nature of Litigation

Writ petition under Articles 226 and 227 of the Constitution of India challenging an appellate order passed under the CGST Act, 2017.

Remedy Sought

Quashing of the impugned appellate order dated 28.02.2024 and consequential reliefs including refund of amounts paid.

Filing Reason

The appellate authority dismissed the petitioner's appeal for non-compliance with pre-deposit without granting a personal hearing and without passing a reasoned order, allegedly in violation of principles of natural justice and Section 107(11) of the CGST Act, 2017.

Previous Decisions

The Assistant Commissioner of Central Tax, South Division-1, Bengaluru had passed an order against the petitioner, which was appealed before the Additional Commissioner of GST, Appeals-I, Bengaluru, who dismissed the appeal via the impugned order.

Issues

Whether the impugned appellate order dismissing the appeal for non-compliance with pre-deposit without personal hearing and without reasons is sustainable in law. Whether the appellate authority violated Section 107(11) of the CGST Act, 2017 and principles of natural justice.

Submissions/Arguments

Petitioner argued that the impugned order was passed without granting a personal hearing and without assigning any reasons, in gross violation of principles of natural justice and Section 107(11) of the CGST Act, 2017. Respondent argued that the appeal was rightly dismissed for non-compliance with pre-deposit.

Ratio Decidendi

Section 107(11) of the CGST Act, 2017 mandates that no order in appeal shall be passed without giving the appellant an opportunity of being heard. The appellate authority's failure to provide a personal hearing and to pass a reasoned order before dismissing the appeal for non-compliance with pre-deposit constitutes a gross violation of principles of natural justice and renders the order unsustainable.

Judgment Excerpts

Section 107(11) of the CGST Act, 2017 mandates that no order in appeal shall be passed without giving the appellant an opportunity of being heard. The impugned order does not record any personal hearing nor does it contain any reasons for dismissal. The impugned order is in gross violation of principles of natural justice and Section 107(11) of the CGST Act, 2017.

Procedural History

The Assistant Commissioner of Central Tax, South Division-1, Bengaluru passed an order against the petitioner. The petitioner appealed to the Additional Commissioner of GST, Appeals-I, Bengaluru, who dismissed the appeal via order dated 28.02.2024. The petitioner then filed the present writ petition before the High Court of Karnataka at Bengaluru on 20.08.2024.