Separate GST Liability Orders Must Be Issued To Enable Appeals By Company And MD: Telangana High Court

The Telangana High Court on 8 April, held that a single, composite GST liability order against a company and its Managing Director cannot be used to deny them independent appellate remedies.

The Division Bench of Chief Justice Aparesh Kumar Singh and Justice G.M. Mohiuddin allowed writ petitions filed by Sugna Metal Limited and its Managing Director, and directed tax authorities to issue separate orders. The judges held:

“...,the Managing Director (petitioner in W.P.No.9166 of 2026), after obtaining a temporary registration, is entitled to avail the remedy of appeal and take all such grounds on facts and in law as are available to him…”

The dispute arose after the Department issued a composite Order-in-Original and a single Form GST DRC-07, fastening liability jointly on the company and its Managing Director.

The company and its Director challenged the common order confirming tax, interest, and penalties exceeding Rs. 2.59 crore under the Central Goods and Services Tax Act, 2017.

The Managing Director, who was not even registered under GST, argued that in the absence of a separate liability order, he could not file an independent appeal, effectively depriving him of his statutory remedy.

Accepting this contention, the Court noted that the Managing Director must first be enabled to participate in the statutory process.

The Bench directed the authorities to grant a temporary GST identification number to the Managing Director and, thereafter, issue two separate Form GST DRC-07 orders, one for the company and one for the Managing Director.

Importantly, the Court clarified that the limitation period for filing appeals would begin only after issuance of such fresh separate orders, thereby safeguarding the right of both parties to challenge the demand.

The Bench stated that the “revised two separate Form GST DRC-07 containing the liability as against the Company and its Managing Director be issued within a period of two weeks, so that the aggrieved parties may prefer separate appeals.”

In view of the above, the bench disposed of the writ petition.

For Petitioner: Advocate, Akruti Goyal

For Respondent: Senior Standing Counsel, Dominic Fernandes