HC Sets Aside GST Order for Natural Justice Violation

Case Details: Vikram Bhuwalka vs. Assistant Commissioner of State Tax [2026] 184 taxmann.com 626 (Calcutta)

Judiciary and Counsel Details

• Om Narayan Rai, J.
• Vinay Kumar Shraff, Dev Kumar Agarwal, Ms Ritika Prasad & Prithwijit Sharma for the Petitioner.
• Tanoy Chakraborty & Saptak Sanyal for the Respondent.

Facts of the Case

The petitioner challenged the adjudication order denying input tax credit (ITC) on the grounds of the retrospective cancellation of suppliers’ registrations and the reversal of credit notes. A notice was issued alleging multiple discrepancies, to which the petitioner submitted a reply. At adjudication, one ground relating to exempt supplies was dropped, while liability was confirmed on the remaining grounds. The petitioner contended that the reply and supporting documents evidencing the movement of goods were not properly considered, and that reliance was placed on statements of vehicle owners without furnishing those statements or granting an opportunity for cross-examination. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that reliance on third-party statements without furnishing them or allowing cross-examination constituted a violation of principles of natural justice. It was observed that the jurisdictional officer failed to demonstrate how the petitioner’s documents were evaluated or why they were insufficient under Section 16 read with Section 75 of the CGST Act and the West Bengal GST Act. The Court held that absence of reasoning and denial of opportunity vitiated the adjudication process. Accordingly, the impugned order was set aside and the matter was remanded for fresh adjudication with an opportunity of hearing.

List of Cases Referred to

• Shiva Chemicals v. Asstt. Commissioner of Revenue, State Tax [2024] 165 taxmann.com 13/105 GST 615/89 GSTL 118 (Calcutta) (para 11).