Kumar vs. The Appellate Deputy Commissioner (GST)

Facts

The petitioner, Kumar Contractor, challenged recovery notices dated July 24, 2025, and July 26, 2025, issued by the second respondent, the Deputy Commissioner, for the tax period April 2020-March 2021. These notices were based on demands confirmed by orders in Form GST DRC-07 dated February 14, 2025, and February 17, 2025. The petitioner had been issued notices in Form GST DRC-01 on October 25, 2024, and November 25, 2024, but failed to respond in time, leading to the assessment orders. The petitioner did not challenge the assessment orders directly but challenged the subsequent recovery notices and sought to have their bank account defreezed. The Court noted the petitioner had filed a single writ petition for multiple recovery notices and directed additional court fee payment.

Held

The Court quashed the impugned recovery notices dated July 24, 2025, and July 26, 2025. Furthermore, the Court also quashed the assessment orders dated February 14, 2025, and February 17, 2025, on the grounds that they were passed without affording the petitioner an opportunity of being heard. This relief was made conditional upon the petitioner depositing 25% of the disputed tax in cash from the Electronic Cash Ledger within 30 days of receiving the order. The petitioner was also directed to file a reply to the show cause notices that preceded the impugned orders within a specified time, with the quashed orders to be treated as an addendum to these notices. The respondents were directed to pass a fresh order on merits after hearing the petitioner. The attachment of the bank account would be lifted subject to the petitioner complying with the deposit condition. The Court made it clear that failure to comply would result in the writ petition being deemed dismissed, allowing the respondents to proceed with recovery. No costs were awarded.

Key Issues

1. Whether the recovery notices dated 24.07.2025 and 26.07.2025, issued by the second respondent, are liable to be quashed? (Question of law) 2. Whether the assessment orders dated 14.02.2025 and 17.02.2025, passed by the respondents, are liable to be quashed, and if so, on what conditions? (Question of mixed law and fact) Petitioner's arguments: The petitioner argued that the recovery notices and the underlying assessment orders were flawed. Although not explicitly stated in the judgment, the challenge to recovery notices implicitly suggests an issue with the validity of the demands or the procedure followed. The petitioner sought to quash the recovery notices and defreeze their bank account. Revenue's arguments: The judgment does not record specific arguments made by the respondents (Revenue). However, their participation indicates a defense of the impugned orders and recovery actions.