CBIC Rules and Natural Justice Prevail: Gujarat HC Remands GST Rectification Case:

CBIC Rules and Natural Justice Prevail: Gujarat HC Remands GST Rectification Case The Gujarat High Court threw out the rectification rejection order from December 23, 2025, because it was made without a hearing, which goes against natural justice and the CBIC Notification dated October 8, 2024. The court then sent the case back to the lower court for a new decision within 12 weeks.

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Court Quashes Service Tax Demand Raised Solely on Income Tax Data Without Hearing the Assessee

Fact The petitioner, M/s Hari Om Hardware and Electrical, is a proprietorship dealing in electronic goods and hardware. The verification was done for the title Input Tax Credit (ITC) of the CGST Act 2017. Show-cause proceedings had also been initiated, culminating in the passing of an Order-in-Original on 13.03.2024. The petitioner preferred an appeal under Section 107 of the CGST Act that was rejected by the order dated 12.03.2025. The petitioner then filed a rectification application on 25.03.2025 against the order of the appellate authority. By order dated 23.12.2025, the Additional Commissioner (Appeals), Surat, rejected the rectification application filed by the assessee. The petitioner has challenged the rejection of rectification. [related id="417504."] Issue of the Case Whether the rectification rejection order dated 23.12.2025 was valid when it was passed without granting an opportunity of hearing to the petitioner, in violation of principles of natural justice and Clause 7 of the CBIC Notification dated 08.10.2024. Court's Observation The Court said that the order to reject the rectification hurt the petitioner. The person who responded said that the order was made without giving anyone a chance to be heard. The Court said that Clause 7 of the CBIC Notification dated 08.10.2024 requires following the rules of natural justice, which include giving a hearing when an order is bad. The judgement in question was found to be against the principle of natural justice.

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Judgement  The Gujarat High Court sent the case back for a new ruling after hearing it within 12 weeks of throwing out the rectification rejection order dated 23.12.2025 because it was made without a hearing, which went against natural justice and the CBIC Notification dated 08.10.2024.