The Gujarat High Court has quashed a GST order that had been issued against the entity for failing to intimate the personal hearing, noting that after the issuance of DRC-01, the authority did not provide the date and time of the personal hearing, which was a violation of the principles of natural justice.
The court, in performing the same, cited that while issuing DRC-01, it is not obligatory to incorporate the date and time of personal hearing, but after the forthcoming proceedings progress, however, before the final order is passed, the taxpayer should be informed of the personal hearing date and time.
The applicant’s counsel referred to Section 75(4) GST Act and cited that post issuance of the notice of the Form GST DRC-01, the respondents did not report the date, place, and time of the personal hearing and passed the impugned order. On 28-8-2024, the order was contested by the applicant, and the forthcoming orders of the appellate authority were contested on 6-3-2025.
Form DRC-01 is a notice issued to the taxpayer on the disparities determined during scrutiny.
The counsel of the applicant said that, as per Section 75(4), a chance of hearing will be provided where a request is obtained from the person liable for tax or penalty or where any adverse decision is specified against such individual.
It provided that although details about the personal hearing, such as the date, time, and venue, should be specified, the respondents in the GST portal did not deliver this information. As a result, the applicant was not able to upload the necessary documents or their explanation in response to the Show Cause Notice (SCN).
Towards asking for the information as specified in DRC-01, there is a breach of the principle of natural justice, as no personal hearing has been given by the adjudicating authority, whereas it was the order in the original.
It was furnished that if the writ petition is permitted on this short basis, the other contentions may be kept open and the respondent may be asked to consider it while giving the applicant a personal hearing.
The authority’s counsel specified the screenshot of the portal along with the notings and submitted that, in fact, even after having been granted an adequate chance on three occasions, the applicant did not come forward asking for a personal hearing or intimating a date for a personal hearing, the authorities were restrained from passing the orders.
She cited that after notifying the proceedings in the portal, the taxpayer must verify the following dates, as well as notings, and the respondent assessing officer is not required to issue a separate SCN intimating the date of personal hearing.
A division bench of Justice AS Supehia and Justice Pranav Trivedi in its order said that:
“It is the aforesaid mentioned established fact about issuance of notice under DRC-01 to the petitioner on May 21, 2024, is not in dispute…Thu,s the respondents, while issuing the notice DRC-01, have in fact incorporated the details of personal hearing, which are required to be intimated which including the date by which reply is to be submitted, i.e., June 21, 2024, date of personal, time of personal and venue where hearing will be held. Except for the date of reply, all the details ofthe other three heads are missing”.
As per the court, it discovered that subsequently on the portal, the proceedings were intimated and the screenshot of the portal exhibits the data of SCN of DRC-01, the reminder on July 3, 2024, adjournment on Aug 24, 2024, and time to submit reply was August 27, 2024.
The court also referred to a note on the portal and said:
“Bare perusal of the note would intimate that in fact the petitioner was neither informed about the date and time of the personal hearing, nor the venue as mentioned herein above. Though we may at this stage mention that at the time of issuing DRC-01, it would not be mandatory to incorporate the date of personal hearing, time and venue since it would depend upon the reply filed by the assessee. However, when subsequent proceedings are initiated, and in the portal, before passing any adverse orders, the date, venue and time of personal hearing are required to be specified”
“However, the question would still remain whether respondents are required to intimate the venue time and date to the assessee or not. We are of the considered opinion that as soon as the aforesaid details of personal hearings are incorporated in DRC-01, when subsequent proceedings are taken as and when progress, before the final order is passed against the assessee, he is required to be intimated date and time of the hearing. We further clarify that respondents are not required to issue a show cause notice but are required to intimate the date, time and venue of the personal hearing. In the present matter, since the aforesaid procedure is violated and no intimation of date, time is accorded to the petitioner, the impugned order dated August 28, 2024 and further orders…are required to be quashed and set aside,” the bench cited.
The counsel of the authority at this phase said that till now, as venue is discussed, the “adjudicating authority always specifies the designation and the venue of personal hearing”.
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The court granting relief asked the adjudicating authority to notify the applicant of the date and time for his personal appearance.
“We further clarify that in case, despite intimation to the petitioner about the date and time, he fails to appear, it will be open to the adjudicating authority to pass a final order as it will be deemed to be construed that the petitioner is not interested in a personal hearing,” the bench specified.
| Case Title | Gateway Exim vs. State of Gujarat Through Commissioner of State Tax |
| Case No. | APPLICATION NO. 7183 of 2025 |
| Date | Gateway Exim vs. State of Gujarat Through the Commissioner of State Tax |
| For Petitioner | Priyank P Lodha |
| Gujarat High Court | Read Order |
