Facts of the Case

The petitioner, M/s Vishvaretah Enterprises, challenged an Order-in-Original dated 12.02.2025 and a summary order in FORM GST DRC-07 dated 24.02.2025 levying tax, penalty and fee under Section 73 of the CGST/SGST Acts, 2017 for the tax period 2020-21, alleging multiple procedural violations. These included passing the order without an opportunity of hearing, issuing the summary of show cause notice dated 27.11.2024 without maintaining the mandatory three-month gap under Section 73(2), failing to serve ASMT-10 and FORM GST DRC-01A as contemplated under Rule 142(1A), and issuing the DRC-01 summary without physical or digital signature. A Garnishee Notice in FORM GST DRC-13 dated 21.10.2025 had also been issued to the petitioner's banker. The petitioner had additionally filed a rectification application on 24.11.2025 that remained pending.

Issues Involved

  1. Whether an Order-in-Original suffering from multiple procedural infirmities - denial of hearing, inadequate statutory gap, non-service of ASMT-10/DRC-01A, and an unsigned show cause notice - warrants interference or should be relegated to the statutory appellate remedy.
  2. What interim protection is warranted for coercive recovery, including the garnishee notice, pending the appeal.

Petitioner's Arguments

  • The order under Section 73 was passed without providing any opportunity of being heard, contrary to principles of natural justice and the Rule of Law.
  • The summary of show cause notice dated 27.11.2024 and the order dated 24.02.2025 did not maintain the mandatory three-month gap required under Section 73(2) of the CGST/SGST Act.
  • ASMT-10 and FORM GST DRC-01A, mandated under Rule 142(1A), were never served on the petitioner.
  • The summary of show cause notice in FORM GST DRC-01 dated 27.11.2024 was issued without any physical or digital signature, rendering it non-est in law.
  • The petitioner's pending rectification application dated 24.11.2025 had not yet been disposed of.

Respondent's Arguments

  • The Senior Standing Counsel for CBIC, after obtaining instructions, did not seriously contest that the petitioner could pursue the statutory appellate remedy, submitting that the petitioner was at liberty to raise all available grounds in law and on facts before the appellate authority.
  • The department indicated the petitioner could be protected from further coercive steps pending filing of the appeal, given that a garnishee notice had already been issued.

Court Order / Findings

  • Rather than adjudicating the multiple procedural challenges on merits, the Court held that where an assessee is inclined to pursue the statutory appellate remedy, it should be granted liberty to approach the appellate authority within a defined period along with the statutory pre-deposit and a delay condonation application, without the writ court going into the merits of the contentions raised.
  • Liberty was granted to approach the appellate authority within two weeks with the statutory pre-deposit and a delay condonation application, raising all available grounds of law and fact.
  • The appellate authority was directed to consider the delay condonation in light of the facts and, if satisfied, decide the appeal on merits in accordance with law.
  • No coercive steps were to be taken against the petitioner pursuant to the Garnishee Notice dated 21.10.2025 during the two-week period for filing the appeal.

Important Clarification

  • Even where a GST order suffers from multiple alleged procedural defects (denial of hearing, inadequate statutory gap, non-service of ASMT-10/DRC-01A, unsigned notice), courts may decline to examine each ground on merits and instead relegate the assessee to the statutory appeal, particularly once the assessee itself expresses willingness to appeal.
  • Interim protection from coercive recovery, including garnishee notices, is typically extended only for the limited window allowed to file the appeal with pre-deposit, not indefinitely.

Sections Involved

  • Section 73, CGST/SGST Act, 2017 - determination of tax not paid/short paid, including the mandatory three-month gap under Section 73(2).
  • Section 107, CGST Act, 2017 - appeal to Appellate Authority.
  • Rule 142(1A), CGST Rules, 2017 - communication of details of tax ascertained before issuance of notice.

Decision – In Favour of

Disposed of with directions, in part in favour of the petitioner - liberty granted to pursue a delayed statutory appeal with interim protection from coercive recovery.

Case Details

  • Court: High Court for the State of Telangana at Hyderabad
  • Case No.: Writ Petition No. 8090 of 2026
  • Coram: Chief Justice Aparesh Kumar Singh and Justice G.M. Mohiuddin
  • Date: 6th April, 2026

Link to Download the Order

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