Case Law Details
Humble Plastics Pvt. Ltd. Vs Union of India & Ors. (Gujarat High Court)
GST Section 161 rectification cannot supplant reasons-Demand order set aside for non-consideration of reply; matter remanded for fresh adjudication: Gujarat HC
The petitioner is a trader in plastics. It purchases and sells goods. The GST authorities alleged that it had not received the goods; hence; not eligible to claim input tax credit. A detailed reply was filed. Without considering the same; order confirming demand of over Rs.6 crores; along with interest and penalty; was passed. It filed a writ petition. During the pendency; the department passed rectification order under Section 161 of the CGST Act supplanting reasons for the order and dealing with grounds urged in the reply.
The Hon’ble Gujarat High Court set aside the order and allowed the writ petition. It held: (i) the scope of Section 161 provides for rectification only; being limited; cannot be invoked to supplant reasons; (ii) faced with this; counsel for the department agreed to withers such orders and pass fresh order in original; (iii) accordingly; directs to hear the Petitioner and pass fresh orders after considering the reply filed by the Petitioner.
Argued by Adv. Bharat Raichandani i/b UBR Legal.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
1. RULE returnable forthwith. Ms.Tanushree Shrimal, learned Assistant Government Pleader, waives service of notice of rule on behalf of the respondent No.2 and Mr.Param Shah, learned Senior Standing Counsel waives service of rule for respondent Nos. 1 and 3.
2. After perusing the impugned order dated 16.07.2025, we had noticed that the same does not satisfy the ingredients of Section 161 of the Central Goods and Service Tax Act, 2017, hence we had asked the learned Senior Standing Counsel Mr.Param Shah to take instructions as to whether the respondent would like to withdraw the impugned order and pass fresh order. Upon instructions, he has fairly submitted that the impugned order dated 16.07.2025 will be withdrawn by the respondent authority and a fresh speaking Order-inOriginal will be passed after considering the reply filed by the petitioner within a period of eight weeks.
3. In view of this, the impugned order dated 27.11.2025 passed by respondent No.3, is hereby quashed and set aside qua the present petitioner. A fresh speaking Order-in-Original shall be passed after considering the reply of the petitioner within a period of eight weeks. Rule is made absolute to the aforesaid extent.
It goes without saying that we have not expressed anything on merits and all the contentions of the respective parties are left open.
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