Delhi High Court Quashes ₹26.72 Crore GST Demand After Taxpayer Given Less Than One Working Day To Respond

The Delhi High Court has set aside a GST demand order of Rs 26.7 crore against a company engaged in the business of trading and export of branded mobile phones, holding that it was denied a meaningful opportunity of hearing by the tax authorities.

A division bench of Justices Nitin Wasudeo Sambre and Ajay Digpaul observed that the timeline granted to the petitioner to respond to the Department's queries and to appear for a personal hearing was inadequate and violative of principles of natural justice.

The case arose from a demand order passed on December 31, 2025, pursuant to a show cause notice under the CGST/DGST Act. The petitioner, Avik Televentures Pvt. Ltd., challenged the order on the ground that it was passed in undue haste without affording a fair opportunity to present its case.

The court noted that a communication issued by the department on December 27, 2025, required the petitioner to furnish additional documents by December 29 and appear for a personal hearing on December 30.

Since December 28 was a Sunday, the petitioner effectively had less than one working day to collate voluminous material, including certified bank statements and other records.

Emphasising the impracticality of such a timeline, the bench held that the nature of documents sought could not have been reasonably produced within such a “truncated” period. It further noted that the petitioner's request for a short adjournment was not adequately considered.

“The timeline, as notice hereinabove, clearly demonstrates that the opportunity afforded to the petitioner was illusory. The petitioner was neither granted adequate time to place the requisite material on record nor to effectively respond to the issues raised in the special audit and the SCN,” the Court held.

It also rejected the department's contention that the petitioner had participated in the hearing and clarified that mere participation cannot be construed as compliance with the requirement of affording a fair and effective opportunity.

“The opportunity contemplated under Sections 66(4) and 75(4) of the CGST/DGST Act is not a mere formality but must be real, reasonable, and effective,” it said.

The court also rejected the Department's submission that the petitioner had earlier filed a reply to the SCN.

The same, it said, “does not dilute the requirement of granting a reasonable opportunity when additional material is sought to be relied upon. Once further documents were called for and a hearing was fixed, the respondent was under an obligation to ensure that sufficient time was afforded.”

Accordingly, the Court quashed the impugned order and remanded the matter back to the adjudicating authority for fresh consideration.

For Petitioner: Senior Advocate Kavita Jha, with Advocates Nikhil Kohli, Ishan Gaur and Saumya Tiwari

For Respondent: Advocate Vaishali Gupta, Panel Counsel (Civil), GNCTD with Advocate Kartik Sharma,