Ganga Medical Stores v. Deputy Commissioner of Commercial Taxes (Audit), DGSTO, Bidar & Anr.

What happened

The Deputy Commissioner of Commercial Taxes (Audit), Bidar issued a notice dated 25 July 2025 for an audit of the books of Ganga Medical Stores for the year 2021-22, followed by an intimation in Form GST DRC-01A under section 73(5), a show-cause notice dated 24 September 2025 and an order under section 73(9) dated 11 December 2025, directing payment of tax, interest and penalty. The order was passed ex parte. The petitioner, a woman proprietor, said she was pregnant during the relevant period, needed rest and medical treatment, and could not respond to the notices or take part in the adjudication, and she produced medical records. The time for an appeal under section 107 had expired.

Questions before the court

• Is the proprietor's pregnancy a sufficient reason for setting aside an ex parte GST order and giving a fresh opportunity?

Why the court ruled this way

The Court noted that the audit notice was followed by the show-cause notice and then the order, which was admittedly ex parte, and that a coordinate Bench in Siddappa v. Assistant Commissioner (W.P. No. 204270/2025, decided on 14 August 2026) had remanded a similar case for fresh consideration (paragraph 9). On the medical records, the petitioner deserved one opportunity to submit her reply and place the material before the authority, and since the statutory appeal under section 107 could no longer be filed, and she had given sufficient explanation for her non-appearance, the order could be set aside (paragraphs 10 and 11).

Controlling point

A sufficient explanation, such as pregnancy supported by medical records, for non-appearance in GST adjudication justifies restoration of the proceeding where the relief is conditioned to protect the revenue.

Order and next steps

The writ petition was allowed. The order of 11 December 2025 was set aside, subject to the petitioner depositing 10% of the tax demanded on or before 14 October 2026. The matter was remitted to the first respondent for reconsideration afresh in accordance with law from the stage of the petitioner's reply and documents, which she must file within one month, and she must appear before him on 14 October 2026 without further notice, with liberty to file further reply and documents, after which he must give a reasonable opportunity and hear her. If she fails to appear on 14 October 2026, the impugned order revives automatically without further orders.

Practical implications

A registered person who could not respond to a GST notice for a genuine medical reason should gather the medical records promptly and approach the High Court if the appeal period has lapsed, offering the pre-deposit that the court is likely to impose. The explanation must be specific and documented.

Limits of this ruling

• The relief is conditional on the 10% deposit and appearance on the date fixed; the Court did not decide the merits of the demand.