M/S. Shivam Exports vs. The State Of Andhra Pradesh

Held

The Court disposed of the writ petition by directing the 4th respondent to afford an opportunity of hearing to the petitioner. The Court ordered that the 4th respondent shall consider the replies submitted by the petitioner to the notices issued and pass appropriate orders strictly adhering to the procedure contemplated under the CGST/APGST Act, 2017, and in accordance with law. The Court noted that the petitioner had submitted objections/reply to the notice in Form GST DRC-01 dated 28.08.2026. The Court did not decide on the merits of the petitioner's challenge to the show cause notice but ensured procedural fairness. No costs were awarded. The operative direction is to provide a hearing and consider the petitioner's submissions before passing final orders.

Facts

The petitioner, M/s. Shivam Exports, filed a writ petition challenging the show cause notice dated 28.08.2026 issued by the 4th respondent (Deputy Commissioner, Guntur-II Division). The petitioner is a registered dealer in granite slabs and blocks. Following an inspection on 02.04.2025 under Section 67(2) of the CGST/APGST Act, 2017, and a summons issued on 21.04.2025, the petitioner was asked on 08.07.2026 to produce records for the period 01.04.2020 to 31.03.2025 within 7 days. The petitioner requested 4-5 weeks to trace and reconcile records due to the proprietor's neurological illness and business closure. However, the 4th respondent issued Form GST DRC-01A on 24.08.2026 and subsequently Form GST DRC-01 on 28.08.2026, allegedly before the time granted for reply expired and with discrepancies in case ID numbers. The petitioner sought to declare these actions illegal and violative of natural justice.

Key Issues

1. Whether the action of the 4th respondent in issuing Show Cause Notice dated 28.08.2026, in Form GST DRC-01, is illegal, arbitrary, and violative of the provisions of the CGST/APGST Act, 2017, and the principles of natural justice, considering the petitioner's request for time to produce records and alleged discrepancies in notices? Petitioner's Contentions: The petitioner argued that the 4th respondent acted illegally and arbitrarily by issuing the show cause notice without properly considering the petitioner's request for an extension to produce records, necessitated by the proprietor's illness and business closure. They contended that the issuance of Form GST DRC-01 dated 28.08.2026, even before the expiry of the time granted in Form GST DRC-01A dated 24.08.2026, and the presence of discrepancies in the case ID numbers, violated the principles of natural justice. The petitioner sought to protect their interests by preventing finalization of assessment proceedings without due consideration. Revenue's Contentions: The learned Assistant Government Pleader sought to advance arguments to sustain the action of the tax authorities. However, the Court did not delve into detailed arguments from the revenue's side at this stage.