Violation of 30-Day Notice Requirement u/s 61 of GST Act: Andhra Pradesh HC sets aside Demand Orders [Read Order]

In a recent ruling, the Andhra Pradesh High Court set aside demand orders for violating the 30-day notice requirement under Section 61 of the Goods and Services Tax ( GST ) Act, 2017.

The writ petitions were collectively addressed by the court through a common order due to the identical nature of the issue in all petitions. The petitioner, Sri Saidurga Automobiles, a dealer in automobiles and automobile parts, challenged the demand orders issued by the Assistant Commissioner of Commercial Tax.

The core issue pertained to notices issued on 02.06.2023, which raised certain discrepancies identified during the scrutiny of the petitioners' returns. These show-cause notices allowed a 30-day period for the petitioners to respond, with the deadline being 09.07.2023.

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However, the demand order in Form GST DRC-07 was issued prematurely on 03.06.2023, requiring the petitioners to respond by 09.06.2023. A subsequent show-cause notice in Form GST DRC-01, dated 15.06.2023, demanded replies by 21.06.2023. The final demand order in Form GST DRC-07 was passed on 04.07.2023.

The petitioners, represented by Anil Kumar Bezawada, contended that under Section 61 of the CGST Act, a minimum period of 30 days must be given before any further action can be initiated. They argued that the authorities’ actions were in clear violation of this provision, as steps were taken from 03.06.2023, far earlier than the mandated period.

The bench of Justices R. Raghunandan Rao and Harinath. N found substantial merit in the petitioners' arguments, noting the explicit requirement of a 30-day period under Section 61 of the CGST Act before any further steps can be taken.

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The court stated that the authorities' actions were not only premature but also infringed upon the principles of natural justice by not providing adequate time for the petitioners to respond to the notices.

As a result, the court allowed the writ petitions, setting aside the impugned demand orders dated 04.07.2023. The matter was remanded to the respective authorities with instructions to take appropriate action after granting adequate time in accordance with the CGST Act and relevant rules for the petitioners to file their responses.

To Read the full text of the Order CLICK HERE

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