Two duplicate tax orders set aside for same period; remanded for fresh hearing after taxpayer given time to reply

HC set aside the two impugned orders issued for the same tax period and amount, finding procedural infirmity as the taxpayer had no opportunity to reply or attend personal hearing and noting apparent duplication of SCNs. The matter is remanded to the Adjudicating Authority; the taxpayer is granted time until 15 November 2025 to file replies, after which the Authority must issue notice for personal hearing. Any subsequent order will be subject to the outcome of the pending Supreme Court decision.

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ISSUES PRESENTED AND CONSIDERED

1. Whether two show cause notices and two consequent adjudication orders for the same tax period and for the same demand can stand where they result in duplicate demands for the same tax year.

2. Whether orders passed without giving the assessee a proper opportunity to file a reply and to attend personal hearing violate principles of natural justice and require setting aside/remand.

3. Whether adjudication in the present matter should be stayed or qualified by reference to a pending constitutional/legislative validity challenge (Notification No. 09/2023-Central Tax) before the Supreme Court, and what effect that pending challenge should have on the fresh adjudication.

ISSUE-WISE DETAILED ANALYSIS

Issue 1 - Duplicate SCNs and duplicate orders for same period and same demand

Legal framework: Adjudication under the Central Goods and Services Tax Act, 2017 (Section 73 invoked for tax demand) requires clear and non-duplicative assessment and quantification of liability for specified tax periods.

Precedent treatment: No prior decisions are applied or overruled in the judgment; the Court evaluates the matter on principles of regularity and correctness of adjudicatory process rather than invoking specific precedent.

Interpretation and reasoning: The Court observed that two SCNs were issued for the identical period (July 2017 to March 2018) and two impugned orders were passed producing the same quantified demand. This apparent duplication indicates an error in the process of issuance/adjudication and gives rise to uncertainty and unfairness in enforcement of tax liability.

Ratio vs. Obiter: The Court's finding that duplicate SCNs/orders for the same period and identical demand are unsustainable, insofar as they reflect procedural error warranting corrective action, constitutes ratio insofar as it grounds remand and setting aside of the impugned orders in this case.

Conclusions: The impugned orders founded on two SCNs that produce the same demand cannot stand in the present circumstances and are set aside for de novo consideration by the Adjudicating Authority to rectify the duplication and determine correct liability.

Issue 2 - Failure to provide opportunity to reply and personal hearing (natural justice)

Legal framework: Principles of natural justice (audi alteram partem) require that a person affected by an adjudicatory order be given a reasonable opportunity to present a reply to show cause notices and to be heard in a personal hearing before final adverse orders are passed.

Precedent treatment: The Court relies on established principles of fair hearing; no express precedents are cited or distinguished.

Interpretation and reasoning: The Petitioner received the SCNs by email but did not file any reply and did not attend the personal hearing; the Court finds that the Petitioner thereby did not get a proper opportunity to be heard. Given that absence of adequate opportunity is a procedural infirmity, the impugned orders are unsustainable on that ground.

Ratio vs. Obiter: The direction to set aside the impugned orders and remand for fresh adjudication after affording opportunity to reply and personal hearing is ratio where it corrects the procedural denial of natural justice.

Conclusions: The matter is remanded. The Petitioner is granted a specified period (until 15 November 2025) to file replies to the SCNs; upon filing the Adjudicating Authority must issue a notice for personal hearing, consider the reply and hearing submissions, and pass a fresh order.

Issue 3 - Effect of pending challenge to the validity of Notification No. 09/2023-Central Tax

Legal framework: Where a substantial constitutional/legislative question affecting adjudication is pending before a higher court, subordinate adjudication may be regulated so as not to preclude the outcome of that higher forum.

Precedent treatment: The Court does not decide the validity issue; it recognizes the pendency of the challenge before the Supreme Court and structures relief accordingly. No precedents are applied or overruled.

Interpretation and reasoning: The Court notes that the question as to the validity of Notification No. 09/2023-Central Tax is sub judice before the Supreme Court in a related Special Leave Petition. Consequently, any fresh order passed by the Adjudicating Authority pursuant to the remand must be subject to the outcome of that pending Supreme Court decision.

Ratio vs. Obiter: The direction that any fresh adjudication be subject to the Supreme Court's decision is part of the operative relief in this matter and constitutes ratio in so far as it conditions the effect of the new order on the higher court's ultimate pronouncement.

Conclusions: The Adjudicating Authority's fresh order shall expressly be made subject to the outcome of the pending Supreme Court proceedings challenging the Notification.

Remedial directions and ancillary issues

Legal framework: The supervisory jurisdiction under Article 226 permits remand, setting aside of orders, and directions to ensure compliance with natural justice and orderly adjudication.

Interpretation and reasoning: In light of procedural defects and the pending constitutional challenge, the Court ordered (i) setting aside of the impugned orders; (ii) grant of a definite time (till 15 November 2025) to file replies; (iii) issuance of personal hearing notice upon filing of reply; (iv) consideration of replies and hearing submissions and passing of a fresh order by the Adjudicating Authority; (v) express proviso that any such fresh order shall be subject to the outcome of the pending Supreme Court matter; and (vi) restoration of access to the GST portal within one week to enable uploading of replies and access to notices/documents.

Ratio vs. Obiter: These directions resolving the remedial course - remand, time-limit for reply, hearing requirement, portal access, and conditionality on the Supreme Court outcome - are operative and form part of the Court's ratio for disposal.

Conclusions: The writ petition is disposed by setting aside the impugned orders and remanding for de novo adjudication in accordance with the directions stated above; the Court has not considered merits and leaves all substantive rights and remedies open.

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