Introduction:

Cause Title: Atlanta Tele Cables v. Deputy Commissioner, SGST | Writ Petition (M/B) No. 991 of 2025 | Order dated 25.11.2025:

In a significant reaffirmation of the principles of natural justice and procedural fairness under the Goods and Services Tax regime, the Uttarakhand High Court has quashed a demand order issued under Section 73 of the CGST/SGST Act on the ground that the adjudicating authority unlawfully ignored the assessee’s request for adjournment despite being duly informed that he was abroad during the scheduled date of hearing. The case centred around the petitioner, Atlanta Tele Cables, which approached the High Court contending that the demand order levying tax, interest, and penalty was passed without affording them a reasonable opportunity of personal hearing, and in complete disregard of a written adjournment request explaining the petitioner’s inability to appear due to being outside the country. The petitioner’s counsel produced the original passport before the Court, which clearly showed that the petitioner had travelled abroad on 20.07.2025 and returned to India only on 31.07.2025, a period which covered the date on which the GST authority proceeded ex-parte.

Arguments of the Petitioner:

The petitioner argued that the adjudicating authority’s conduct amounted to a gross violation of the principles of natural justice, particularly the right to a fair hearing embedded within Section 75(4) of the CGST Act, which mandates that an opportunity of personal hearing must be granted when adverse decisions are contemplated. It was submitted that although the petitioner is entitled under law to a maximum of three adjournments, they had requested only one—well within statutory limits—and had done so for a valid, documented, unavoidable reason. The adjournment application was duly filed in writing and informed the authority of the petitioner’s confirmed international travel; however, the authority neither acknowledged nor considered it before passing the final order. The petitioner argued that authorities exercising quasi-judicial powers must apply their mind to the circumstances presented before them, and cannot mechanically proceed ex-parte merely because a date had been fixed for hearing. The petitioner emphasised that the GST demand order was not only procedurally defective but substantively illegal because the cornerstone of adjudicatory fairness was ignored, causing grave prejudice. The counsel further submitted that the petitioner was ready, willing, and prepared to participate in the reconsidered proceedings, and that the petitioner had already committed to appear before the department on the next scheduled date of hearing, 04.12.2025 at 11:00 a.m.

Arguments of the Respondent (GST Department):

The respondent authority, represented by Ms. Puja Banga, defended the demand order by suggesting that reasonable opportunity had been afforded and that the assessee had not sufficiently justified the adjournment need at the time the order was passed. The department argued that statutory timelines under Section 73 are strict and binding, and that adjudicating authorities are often constrained by limitation norms, requiring them to complete proceedings expeditiously. While acknowledging that adjournments can be granted, the respondent contended that they are discretionary and not absolute rights. The department also argued that the taxpayer’s alleged inability to appear should not indefinitely stall adjudication processes, particularly when large revenue implications were involved. However, the department was unable to refute the documentary proof produced before the Court establishing that the petitioner was outside India and had filed a timely adjournment request. The respondent urged that even if there had been an inadvertent lapse, the entire matter could simply be remanded without striking down the order on grounds of illegality.

Court’s Judgment:

The Division Bench of Chief Justice G. Narendar and Justice Subhash Upadhyay delivered a categorical and well-reasoned order, holding that the impugned GST demand order was unsustainable in law due to breach of statutory procedure and violation of natural justice principles. The Court noted that the petitioner was legally entitled to request up to three adjournments under the CGST Act, and in this case had sought only one, supported by documentary evidence of being abroad. The Court emphasised that adjudicating authorities cannot proceed ex-parte without deciding an adjournment request, especially where the request is timely, genuine, and substantiated. The Court further observed that the petitioner’s passport clearly established that he exited India on 20.07.2025 and returned only on 31.07.2025, making personal appearance impossible during the period in which the hearing was fixed. The Court held that the respondent authority’s failure to acknowledge, consider, or dispose of the adjournment application rendered the proceedings “bad in law.” The Court reaffirmed that when an authority acts without considering relevant material on record or ignores a lawful request, it fails the test of fairness required of any quasi-judicial process. The Court, therefore, quashed the impugned demand order passed under Section 73 of the CGST/SGST Act and remanded the matter to the authority to conduct fresh proceedings in accordance with law. The Court also recorded the petitioner’s willingness to appear for personal hearing on 04.12.2025 at 11:00 a.m. and directed that the respondent authority shall either proceed with the matter on that date or assign another suitable date for hearing but ensure that the petitioner is granted sufficient opportunity. The Court further directed that if the assessee sought any rescheduled date, they must appear without fail and conclude the hearing on that date to ensure timely disposal. The judgment thus stands as a strong reminder to tax authorities that procedural fairness is not a formality but a fundamental obligation, and non-consideration of adjournment requests amounts to a violation of statutory rights. The Court’s decision reinforces that GST adjudication, though based on strict timelines, cannot bypass principles of natural justice, and any order passed without due hearing cannot stand. This ruling not only safeguards the rights of taxpayers but also ensures that the integrity of quasi-judicial processes under the GST regime is maintained with fairness, reasonableness, and respect for due process.