Ms S S Medical Systems Private Limited vs. The Commissioner State Tax Headquarters
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The petitioner, M/s SS Medical Systems (INDIA) Private Limited, filed a writ petition before the Uttarakhand High Court. The case is similar to a previous writ petition, M/s Modine Thermal Systems Private Limited vs. State of Uttarakhand and others, disposed of by the same bench. In the prior case, the petitioner received a show cause notice dated 18.06.2024 (Form GST ASMT-10) seeking details on the difference between outward supplies declared in GSTR 1 and e-way bills for the financial year 2020-2021. The petitioner replied on 17.07.2024. Subsequently, on 28.11.2024, a demand notice (Form DRC-01) was issued for Rs. 71,57,938/- with interest, proposing to confirm the demand due to the aforementioned difference. A personal hearing was scheduled for 20.12.2024, with the last date for reply being 28.12.2024. The petitioner sought an adjournment for the personal hearing to collate information.
Held
The Court held that the approach of the Revenue Authority in fixing the personal hearing date before the last date for submission of the reply was incorrect and contrary to the scheme of the Act, particularly Section 75(4) and 75(5) of the CGST Act. Section 75(4) mandates an opportunity of hearing when a request is received or an adverse decision is contemplated, while Section 75(5) allows for adjournment for sufficient cause, to be recorded in writing, with limitations on the number of adjournments. The Court found that the order did not disclose any justifiable reasons for rejecting the petitioner's request for adjournment. Therefore, the assessment order was set aside. The matter was remitted back to the competent authority to proceed from the stage of the notice dated 28.11.2024. The ratio decidendi is that procedural fairness, as mandated by Section 75, requires that an assessee be given adequate opportunity to submit their reply before a personal hearing is conducted, and adjournments for sufficient cause should be granted.
Key Issues
1. Whether the Revenue Authority's approach of fixing a personal hearing date before the last date for submission of a reply is contrary to the scheme of the GST Act, specifically Section 75(4) and 75(5)? Petitioner's argument (inferred from the prior judgment): The petitioner argued that the Revenue Authority's action of scheduling a personal hearing before the last date for submitting a reply was procedurally incorrect and akin to 'putting the cart before the horse'. They contended that submissions during a personal hearing should be based on a submitted reply, and insisting on a hearing prior to the reply submission is contrary to the Act's scheme. They relied on Section 75(4) and 75(5) of the CGST Act, which provide for an opportunity of hearing and the possibility of adjournment for sufficient cause. Revenue's argument: The learned Brief Holder for the State submitted that the facts in the instant case are similar to the facts in the previously decided writ petition.
Sections Cited
Section 73, Section 74, Section 75
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Cause title — parties, addresses and appearances
JUDGMENT: (per Sri G. NARENDAR, C.J.)
Learned counsel for the petitioner places reliance on an order of this Bench dated 21.04.2025, rendered while disposing of Writ Petition (M/B) No. 123 of 2025 “M/s Uttarakhand and others”. The order reads as under :
“Heard the learned counsel for the petitioner and learned State Counsel. 2) The case in a nutshell is that the petitioner was visited with a show cause notice dated 18.06.2024 issued by the 2nd respondent in form GST ASMT–10 seeking the details and explanation pertaining to the difference in the value of outward supplies declared in GSTR 1 and value of the E–way Bills raised in the financial year 2020-2021. 3) That the petitioner effected a reply to the show cause notice dated 18.06.2024 by it’s reply dated 17.07.2024; that on 28.11.2024, the 2nd respondent issued form DRC – 01 1
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(SCN) to showcause that why a demand of Rs. 71,57,938/- shall not be confirmed with interest for difference in value of outward supplies declared in GST R-1 and the value of E–way Bills raised during the relevant period. Further, under the said notice, the respondents scheduled a personal hearing on 20.12.2024 and mentioned the last date for submission of reply as 28.12.2024. The petitioner sought for adjournment of the date of personal hearing to a date after the submission of their reply. The request for adjournment was premised on the basis of the petitioner attempting to collate information pertaining to 2021. 4) In our opinion, the approach of the Revenue Authority in fixing the personal hearing date before the last date for submission of reply is akin to putting the cart before the horse. The submissions to be made during the personal hearing would necessarily be on the basis of the reply effected. The approach of the Authorities on insistence of having a personal hearing prior to submitting a reply is contrary to the scheme of the Act also. 5) A conjunctive reading of Section 73, 74 and 75 makes it apparent that the approach adopted by the Authority is contrary to the scheme of the Act. SubSection 4 and 5 of Section 75 of the Act reads as under:- “75.(4) An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person. (5) The proper officer shall, if sufficient cause is shown by the person chargeable with tax, grant time to the said person and adjourn the hearing for reasons to be recorded in writing: Provided that no such adjournment shall be granted for more than three times to a person during the proceedings.” 6) The scheme of the Act enables the assessee to seek for adjournment not in excess of three times and it is pertinent to note that sub-section 5 succeeds sub-section 4, which enables the assessee to seek for a personal hearing. Section 75 relates to the procedural aspect that is required to be followed by the Authorities in the matter of determination of assessment, more particularly, of tax that has escaped assessment. 7) If the statute stipulates a matter to be performed in a particular manner, the same shall be performed in that manner only. Law in this regard is no more res integra and is well- 2
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settled by catena of judgments of the Apex Court. 8) In the case on hand, the order does not disclose any justifiable reasons for rejecting the application for request for adjournment and that apart, as noted above, the approach itself appears to be incorrect and contrary to the scheme of Section 75, more particularly, sub-section 4 and 5 of Section 75. 9) In that view of the matter, the order of assessment is set-aside. The matter is remitted back to the competent authority to proceed from the stage of the 28.11.2024 notice. 10) No order as to costs. The writ petition stands ordered accordingly.”
Learned Brief Holder for the State Ms. Puja Banga submits that she has been instructed to state that the facts involved in the instant case are similar to the facts in the writ petition disposed of by this Court, i.e. Writ Petition (M/B) No. 123 of 2025, referred to hereinabove.
The submission is placed on record.
The instant Writ Petition is also disposed of in the above terms.
There shall be no order as to costs.
As a sequel thereto, the miscellaneous petitions, if any pending, shall stand closed.
(G. NARENDAR, C.J.)
(SUBHASH UPADHYAY, J.) Dated: 06.01.2026 Rajni 3
Reproduced from the public record of the Uttarakhand High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.