GST: Where adjudication order confirming demand, interest and penalty was passed without considering reply furnished in prescribed form, such non-consideration amounted to violation of natural justice, therefore, impugned order was to be set aside and matter was to be remitted for fresh decision on merits after giving opportunity of hearing and permitting supplementary reply
HIGH COURT OF MADRAS
Tvl. Arokiya Matha Timber v/s Deputy State Tax Officer-II
C. SARAVANAN, J. WP NO. 9543 OF 2026
WMP NOS.10280 AND 10283 OF 2026
Demands - Non-consideration of reply/Non-speaking order - Natural justice violation - Period 2019-2020 - Petitioner-assessee under GST had challenged adjudication order confirming SCN proposals - SCN in Form DRC-01 had been issued proposing demand with interest and penalty - Petitioner had filed reply in Form DRC-06 with supporting GSTR-3B eligible ITC - Adjudicating authority confirmed proposals - On writ, grievance was that DRC-06 reply had not been considered and hearing had not been granted - HELD : Non-consideration of DRC- 06 reply while passing impugned order evidenced violation of principles of natural justice - Impugned order was to be set aside and matter was to be remitted for fresh decision on merits after affording personal hearing - Petitioner was permitted to file supplementary reply within 30 days and bank account attachment stood lifted [Section 75 of Central Goods and Services Tax Act, 2017/Tamil Nadu Goods and Services Tax Act, 2017] [Paras 6 and 7] [In favour of assessee/matter remanded]
S. Rajendran for the Petitioner. Mrs. P. Selvi, Govt. Adv. for the Responder
ORDER
1.Mrs.P.Selvi, learned Government Advocate, takes notice for the Respondent.
2. This Writ Petition is being disposed of at the stage of admission itself with the consent of the learned counsel for the Petitioner and the learned Government Advocate for the Respondent.
3. The petitioner is before this Court against the impugned order dated 09.10.2025, whereby the proposal in the Show Cause Notice in DRC-01 dated 16.09.2024 issued for the tax period 2019-2020 has been confirmed. The Operative Portion of the impugned order, which reads as under:
Summary of Defects/Discrepancies
The notices sent through common portal, the taxpayer neither filed objection nor availed the opportunity of personal hearing to contest the proposal found in the notices. Therefore it is construed that the taxpayers have no objection to the proposals, and in absence of the reply/objection to the proposals found
in the notice is confirmed with levy of interest and penalty and adjudication order passed for the year 2019-20 as detailed below confirmed as proposed above under section 74 of the GST Act, 2017.
4. Challenging to the impugned order primarily on the ground that the petitioner had submitted its reply on 25.02.2025 in response of the above Show Cause Notice in Form DRC-06 dated 25.02.2025 along with supporting document GSTR3B-Eligible ITC and the copy of the same is available in the Court bundle.
5.Mrs.P.Selvi, learned Government Advocate appearing for the respondent submitted that the appropriate orders may be passed.
6. Considering the submissions made by the learned counsel on either side and taking into account that the petitioner's reply dated 25.02.2025 has not been considered while passing the impugned order. Thus, it is evident that there is a violation of principles of natural justice.
7. Considering the same, the impugned order is set aside and the case is remitted back to the Respondent to pass a fresh order on merits as expeditiously as possible. Needless to state, before passing such order, the petitioner shall be heard. If the Petitioner desires, the Petitioner may also file a supplementary reply of the Show Cause Notice in DRC-01 dated 16.09.2024, within a period of thirty (30) days from the date of receipt of a copy of this order. The attachment of the petitioner's Bank account shall stand lifted.
8.This writ petition stand disposed of with the above observations. No costs. Consequently, connected Miscellaneous Petitions are closed.
Source: Taxmann.com