Section 73 GST Order Set Aside for Personal Hearing Denial Subject to Pre-Deposit Condition

By | September 25, 2026
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Section 73 GST Order Set Aside for Personal Hearing Denial Subject to Pre-Deposit Condition

Section 73 GST Order Set Aside for Personal Hearing Denial Subject to Pre-Deposit Condition

Issue

Whether an assessment order passed under Section 73 following a DRC-01 summary Show Cause Notice is legally sustainable when the proper officer fails to afford a personal hearing to the taxpayer as mandated under Section 75(4) of the CGST/WBGST Act.

Facts

  • Issuance of Notice: A summary Show Cause Notice in Form GST DRC-01 was issued against the petitioner proposing an adverse tax determination under Section 73.
  • Denial of Hearing: The proper officer completed the adjudication and passed the order under Section 73 without communicating the date, time, or venue for a personal hearing to the petitioner.
  • Procedural Flaw: The petitioner was not afforded an opportunity of personal hearing prior to the passage of the adverse assessment order.
  • Writ Petition: The petitioner challenged the Section 73 adjudication order before the High Court via a writ petition, citing natural justice violations under Section 75(4).
  • Delay in Challenge: The impugned determination was passed in 2023, and there was a delay on the part of the petitioner in approaching the High Court via writ jurisdiction.

Decision

  • Violation of Section 75(4 Mandate): Section 75(4) makes it mandatory to afford a personal hearing whenever an adverse decision is contemplated against a taxable person, irrespective of whether a specific request is made. Failing to intimate the date, time, and venue for a hearing constitutes a statutory infraction. [Paras 5 and 6] [In favour of assessee]
  • Order Set Aside: The impugned adjudication order passed under Section 73 was set aside due to procedural non-compliance with Section 75(4). [Paras 5 and 6] [In favour of assessee]
  • Conditional Remand: Considering the delay in filing the writ petition, the petitioner was put to terms to deposit 10 percent of the disputed tax within four weeks. [Paras 5 and 6] [Partly in favour of revenue]
  • Fresh Adjudication: Upon payment of the 10 percent pre-deposit, the proper officer is directed to permit a response and adjudicate the matter afresh after granting a proper personal hearing. [Paras 5 and 6] [Matter remanded]

KeyTakeaways

  1. Mandatory Personal Hearing under Section 75(4): Providing an opportunity for a personal hearing is an obligatory statutory requirement under Section 75(4) whenever an adverse tax order is contemplated; it cannot be bypassed by the proper officer.
  2. Communication of Hearing Details: Simply issuing a DRC-01 notice is insufficient; the department must explicitly inform the taxpayer of the specific date, time, and venue for the personal hearing.
  3. Conditional Relief for Delayed Writs: Where a taxpayer approaches the High Court after a delay against an order suffering from natural justice defects, courts may condition the remand and rehearing on a partial pre-deposit (e.g., 10% of disputed tax).
HIGH COURT OF CALCUTTA
Babita Sharma
v.
Assistant Commissioner of Revenue
Raja Basu Chowdhury, J.
WPA No. 1633 of 2026
SEPTEMBER  9, 2026
Boudhayan Bhattacharyya, Ms. Stuti Bansal and Ms. Keya Kundu for the Petitioner. Jagriti Mishra, Ld. AAAG, Ms. Radhika Agarwal, Ratan Banik and Bishwaraj Agarwal for the Respondent.
ORDER
1. The present writ petition has been filed challenging the order dated 11th December, 2023 passed under Section 73 of the WBGST/CGST Act, 2017 (hereinafter referred to as the said Act).
2. Ms. Bansal, learned advocate appearing for the petitioner has, however, drawn attention of this Court to summary of the show-cause notice issued in form GSTDRC 01 dated 27th September, 2023 and would submit that the adjudication was made without affording opportunity of hearing to the petitioner. According to her, though, the proper officer was under an obligation having regard to the provisions contained in Section 75(4) of the said Act to provide an opportunity of hearing, irrespective of the fact whether the petitioner prays for the same since, the show-cause contemplated an adverse decision, the same was ignored.
3. Mr. Mishra, learned AAAG appears for the State GST authorities and Mr. Banik learned advocate appears for the CGST authorities.
4. Mr. Mishra does not dispute the fact that in the instant case, the date and time of personal hearing was not provided to the petitioner.
5. Having heard the learned advocates appearing for the respective parties and having considered the materials on record, I find that when a show-cause is issued which contemplated an adverse decision, in terms of Section 75(4) of the said Act irrespective of the fact whether any request is made, an opportunity of hearing is required to be afforded to the person chargable with tax or penalty. In the instant case, I find that the petitioner was not made aware of the date and time and venue of personal hearing. Thus, there appears to be infruction of the provisions of Section 75(4) of the said Act.
6. At the same time this Court cannot ignore the fact that a determination had already been made in the year 2023. This petitioner has been filed only on 10th August, 2026. Accordingly, the petitioner should be put to terms. The petitioner shall deposit 10 per cent of the Tax in dispute within four weeks from date. If such deposit is made, the proper officer shall adjudicate the show cause afresh in accordance with law. The petitioner shall be at liberty to file a response to the show-cause within a period of a week from the date of deposit. If such response is filed or if no response is filed, the proper officer having regard to the provisions contained in Section 75(4) of the said Act shall hear out and dispose of the show-cause in accordance with law upon affording opportunity of hearing to the petitioner. As a sequel, the order impugned shall stand set aside.
7. It is expected that decision in this regard shall be taken by the proper officer within a period of eight weeks from the date of affording personal hearing to the petitioner.
8. It is made clear if no deposit as directed is made, the petitioner shall not be entitled to the benefit of this order and the writ petition shall stand dismissed which shall have the effect of revival of the order impugned.
9. With the above observations and directions, the writ petition is disposed of.