TaxTMI 
TaxTMI 
TaxTMI 
This article is for all tax officials passing adjudication orders on GST all over India in order to help them to ensure that their orders are not set aside or quashed at a later date by the Tribunal or High Court. There is a significant damage to the society by passing an order which is impermissible under law as the damage is not only for GST official passing that order but for all connected therewith. The GST officer definitely needs imposition of cost in all deserving cases so as to ensure that such impermissible orders come down in the long run. While imposition of cost on GST officer passing a wrong order is the prerogative of the Honorable high court, it is felt that there is a need to consider this issue so as to ensure that the most precious time of high court is not spent on procedural issues.
It is only due to invocation of section 74 without considering the CBIC instructions dated 13/12/2023 by many GST officers all over India, both the sections 73 and 74 were kept in force only up to the period ending on 31/03/2024. Hence, as notice under section 73 is possible as on date only for the financial years 2022-23 and 2023-24, restrict show cause notices in all non- fraud cases only for the above two years. Kindly avoid section 74 just for extending the period or enhancing the penalty, as no purpose is solved when the order invoking Section 74 is set aside subsequently.
A minimum period of three months is required between date of show cause notice and date of adjudication order. Kindly ensure that this requirement is fulfilled in respect of all orders In Original being passed now onwards to ensure that the order is not quashed at a later date. The idea behind this concept is for all cases under section 73 to ensure that the taxpayer gets a reasonable time to reply and appear for personal hearing.
Another common error is that in no case the amount determined as payable under the Order In Original can exceed the demand raised in the corresponding show cause notice. Section 75 (7) is a much powerful section and any violation of this sub-section 7 of section 75 may result in quashing or setting aside of the order as it happened in the case of Muthiah Ramesh Proprietor of Tvl. New Print World Versus The Assistant Commissioner (ST), Amazon Seller Services Private Limited, Chennai - 2026 (4) TMI 142 - MADRAS HIGH COURT. The operative portion of the order reads as follows:
7.Considering the same, I am inclined to interfere with the order and remit the case back to the 1st respondent to pass a fresh order on merits. Accordingly, the Impugned Order stands quashed. The 1st respondent may issue further corrigendum within a period of 30 days from the date of receipt of a copy of this order and the petitioner shall thereafter file his response to the Show Cause Notice dated 29.09.2025, by treating the Impugned Order dated 17.12.2025 as an addendum to the aforesaid Show Cause Notice within a period of 20 days. Considering the said response filed by the petitioner, the 1st respondent shall pass final orders on merits and in accordance with law.
8.This Writ Petition stands disposed of with the above observations. No costs. Connected Writ Miscellaneous Petitions are closed.
The most common error many GST officers commit in large number is non effective communication of the Show Cause Notice. Posting all notices under the tab additional notices or notices does not solve any useful purpose when no reply is received from the taxpayer. The GST officer has several options on hand such as e mail, speed post etc. for effective communication to the taxpayer to ensure that the show cause notice reaches the taxpayer. In my experience, I observe that almost in all cases, whenever the matter reaches the jurisdictional high court on the principles of violation of natural justice due to absence of personal hearing, the courts have taken the stand that the order passed without personal hearing is devoid of any merit and liable to be set aside.
Another error which is most common is issuance of single show cause notice for multiple tax periods under section 74. Several high courts all over India have already taken the stand that such show cause notice for more than one tax period is impermissible in law. Recently, the Division Bench of the Bombay High Court held on 27/02/2026 in writ petition number 1829 of 2026 in the matter of M/s. Shree Balaji Traders, Dabki Road, Akola, Through Proprietor Mr. Pratik G. Tiwari Versus The GST Commissioner, Nagpur-II, GST Commissionerate, Nagpur and Ors. - 2026 (3) TMI 247 - BOMBAY HIGH COURT that the SCN for multiple financial years issued on 10/01/2025 is quashed and set aside.
It may be concluded that GST officers while passing orders in original be more cautious in future to ensure that the errors covered above such as wrong invocation of section 74, passing orders against show cause notice within three months, confirming a larger demand than raised in SCN, violation of principles of natural justice by the quasi-judicial officer as well as single SCN for multiple financial years etc.
The basic idea of reiterating the above points is to ensure that this message reaches many tax officers to ensure significant improvement in quality of orders they pass as GSTAT is likely to be fully functional soon.