M/S Woodpecker Distilleries And vs. Deputy Commissioner

Held

The High Court allowed the petition. The Court found that the petitioner had specifically requested a personal hearing in their reply dated October 7, 2025. However, the respondent failed to provide this opportunity before passing the impugned adjudication order dated October 28, 2025. The Court held that this failure constituted a violation of the principles of natural justice and Section 75(4) of the KGST Act, 2017. Consequently, the impugned order was set aside. The matter was remitted back to the respondent for reconsideration afresh in accordance with the law. The petitioner was directed to appear before the respondent on February 2, 2026, and was granted liberty to submit additional pleadings and documents. The respondent was directed to provide a sufficient and reasonable opportunity, including a personal hearing, to the petitioner. The Court also stipulated that if the petitioner failed to appear on the specified date, the order would stand recalled, and the petition would be revived.

Facts

The petitioner, M/s Woodpecker Distilleries and Breweries Private Limited, filed a writ petition challenging an adjudication order dated October 28, 2025, passed by the Deputy Commissioner of Commercial Taxes (Audit) for the period April 2021 to March 2022. The petitioner contended that the order was passed without legal basis and in violation of principles of natural justice. The process began with an audit report on September 10, 2025, followed by a pre-intimations notice (Form GST DRC-01A) on September 15, 2025. The petitioner replied on September 19, 2025, requesting a personal hearing and submitted supporting documents on September 20, 2025. Subsequently, a show cause notice under Section 73(1) of the KGST Act, 2017, was issued on September 22, 2025, to which the petitioner replied on October 7, 2025, again requesting a personal hearing.

Key Issues

1. Whether the Adjudication Order No.DCCT(A)/CKM/2025-26/T.No.1592 dated 28.10.2025, passed for the period April 2021 to March 2022, is liable to be set aside for being passed without legal basis and in violation of the principles of natural justice, specifically concerning the denial of a personal hearing, as contemplated under Section 75(4) of the KGST Act, 2017? Petitioner's Contentions: The petitioner argued that despite explicitly requesting a personal hearing in their reply dated October 7, 2025, the respondent proceeded to pass the impugned adjudication order without affording them an opportunity for a personal hearing. This action, they contended, violates both the principles of natural justice and the specific provisions of Section 75(4) of the KGST Act, 2017, rendering the order legally unsustainable. Respondent's Contentions: The learned AGA argued that the petition lacks merit and is liable to be dismissed. They submitted that the respondent had considered the reply and documents submitted by the petitioner and passed a well-considered order that does not warrant interference by the High Court.