GST Assessment Order Quashed as Personal Hearing Was Fixed Before Reply Deadline

Star Medical Stor Vs Assistant Commissioner State Goods & Service Tax (Uttarakhand High Court)

The petitioner challenged a show cause notice dated 22.05.2024 issued under Section 73 of the GST Act, 2017, and the consequential assessment order and Form DRC-07 dated 21.08.2024. The primary contention was that the date fixed for personal hearing was scheduled before the last date available for filing a reply to the show cause notice, making the procedure adopted illegal and contrary to the principles of natural justice.

The petitioner relied on an earlier decision of the Court to support its contention. The Revenue fairly conceded that the personal hearing had been fixed 18 days before the last date prescribed for filing the reply and that the hearing offered was therefore illusory and not in conformity with the prescribed procedure.

Considering this position, the High Court held that the procedure followed was defective. Consequently, the assessment order was quashed. The Court remitted the matter back to the Adjudicating Officer with a direction to proceed afresh from the stage of the show cause notice after fixing a date for personal hearing. The writ petition was accordingly disposed of, and all pending applications were also disposed of.

FULL TEXT OF THE JUDGMENT/ORDER OF UTTARAKHAND HIGH COURT

1. The present writ petition has been filed, praying for the following reliefs:-

“a. Issue a writ, order or direction in the nature of certiorari quashing the impugned order issued by respondent no.1 under section 73 of the GST Act, 2017 and FORM DRC-07 bearing reference no. ZD050824014333Q dated 21.08.2024 (Annexure-1); as the same has been passed in utter disregard to the principles of natural justice.

b. Issue a writ, order or direction in the nature of certiorari quashing the impugned show cause notice issued by respondent no.1 under section 73 of the GST Act, 2017 along with FORM DRC-01 bearing reference no.ZD050524017806G both dated 22.05.2024 (Annexure-2)

c. Issue a writ, order or direction, in the nature of mandamus directing the respondent no.1 to restrain from taking any coercive step against the petitioner in regard to the impugned order issued by respondent no.1 under section 73 of the GST Act, 2017.

d. Issue a writ of certiorari or a writ in the nature of mandamus directing respondent no.1 to re-decide the matter after providing an opportunity of personal hearing to the petitioner and considering all the submissions and documents.”

2. The submission of learned counsel for the petitioner is that date of personal hearing was fixed before the last date of submission of the reply to the show cause notice, and, therefore, the procedure adopted was wholly illegal. In support of the submission, reliance has been placed on an order dated 17.03.2026, passed in Writ Petition (M/B) No.166/2026 “M/s Abuturrab Agencies v. The Commissioner, State Tax and another”.

3. Learned counsel for the Revenue very fairly concedes that, since date for personal hearing was fixed 18 days prior to the last date fixed for filing of the reply, the hearing presumably offered was illusory, and not in conformity with the procedure prescribed.

4. Accordingly, the Assessment Order is, hereby quashed. The matter is remitted back to the Adjudicating Officer to proceed from the stage of show cause notice, after fixing a date for personal hearing.

5. The writ petition stands disposed of.

6. All pending applications stand disposed of accordingly.