Case Classification under GST Act, 2017
Category: Input Tax Credit – Ex-parte assessment under Section 73 CGST Act – Violation of natural justice due to non-consideration of reasonable cause.
Core Issue: Whether an ex-parte order under Section 73 can sustain when the taxpayer could not respond due to the prolonged illness and death of a close family member.
Case Details
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Case Title: Anita Bansal Proprietress of M/s A.B. Enterprises v. Union of India & Anr.
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Court: High Court of Delhi
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Petition No.: W.P.(C) 4520/2024 & CM APPL. 18438-39/2024
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Date of Judgment: 08.04.2024
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Relevant Provisions: Sections 73, 75(4), 75(3) CGST/DGST Act
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Cause of Action: Ex-parte assessment order confirming demand of ₹21,11,088 on alleged excess ITC claim.
Facts of the Case (Paras 1, 4–7)
The petitioner, a proprietorship engaged in business under GST, received a Show Cause Notice (SCN) dated 23.09.2023, alleging excess claim of ITC. The adjudicating authority, vide order dated 30.12.2023, disposed of the SCN ex-parte and confirmed a demand of ₹21,11,088, relying solely on the taxpayer’s non-appearance and absence of reply.
The petitioner approached the High Court explaining that she was unable to reply as her husband—central to day-to-day business operations—was hospitalised from 04.11.2023 and passed away on 20.12.2023, coinciding exactly with the hearing date. Medical records substantiated the prolonged terminal illness and death.
The impugned order recorded that despite a “REMINDER” on the portal under Section 75(4), no reply was filed; hence, the officer proceeded ex-parte.
Questions / Issues Before the Court
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Whether the ex-parte assessment order under Section 73 can survive when the taxpayer was prevented from responding due to exceptional circumstances—namely, prolonged illness and death of her husband.
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Whether the adjudicating authority acted contrary to principles of natural justice by failing to consider reasonable cause for non-reply.
Observations of the Court (Paras 5–9)
The Court noted that:
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The SCN alleged excess ITC claim, but the adjudication was concluded purely on the basis of non-reply, without inquiry into merits (Para 5).
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The order reveals that the authority’s sole rationale for confirming demand was the taxpayer’s absence (Para 7).
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Medical documents show the petitioner’s husband was hospitalised from 04.11.2023 until his death on 20.12.2023, making compliance impossible (Para 7).
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The Court held that such circumstances constitute a valid and reasonable cause, and failure to consider them amounts to violation of natural justice (Para 8).
The Court emphasised that adjudication under Section 73 is quasi-judicial; hence the officer must exercise discretion judiciously and cannot mechanically conclude proceedings merely because the taxpayer did not log in or upload a reply.
Judgment / Verdict (Paras 9–12)
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The impugned order dated 30.12.2023 was set aside as it was passed solely due to non-reply and without consideration of genuine hardship (Para 9).
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The matter was remanded to the Proper Officer for fresh adjudication strictly in accordance with law.
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The petitioner was allowed 30 days to file a reply (Para 10).
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The Proper Officer must grant personal hearing and issue a speaking order compliant with Section 75(3) (Para 10).
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Challenge to Notification No. 9 of 2023 was left open (Para 11).
Case Law Table – Cases Referred & Their Verdicts
(The judgment does not cite any external precedent; the decision is based entirely on factual hardship and principles of natural justice.)
| Case Referred | Court / Citation | Principle / Verdict |
|---|---|---|
| None cited in judgment | — | The Court relied solely on statutory interpretation and factual evaluation. |
Between the Fine Lines – Practical Takeaways for Trade & Industry
This ruling reinforces that GST adjudication must remain sensitive to genuine human circumstances. When a taxpayer is prevented from responding due to severe medical emergencies or death in the family, authorities cannot mechanically confirm demands. Businesses facing SCNs should document genuine impediments and seek relief, as courts will protect procedural fairness even in revenue matters. This case is particularly beneficial for small proprietorships where personal crises directly impede compliance.
Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”
