Have you received a GST demand order without proper hearing? You are not alone. In 2026, several High Courts have set aside GST orders where taxpayers were not given a fair opportunity of being heard.

Imagine receiving a GST demand order running into lakhs of rupees — without ever being properly heard.

This is not hypothetical. In 2025–26, several High Courts across India have set aside GST orders where officers failed to provide meaningful opportunity of hearing.

The safeguard? Section 75 of the Central Goods and Services Tax Act, 2017.

Legislative Background

GST demand proceedings are generally initiated under:

Section 73 – Non-fraud cases
Section 74 – Fraud / suppression cases
Section 74A – Consolidated demand provision

However, procedural safeguards governing these proceedings are contained in Section 75.

It ensures that adjudication follows principles of natural justice.

What Section 75 Actually Provides

Section 75 contains critical protections:

✔ Opportunity of Being Heard

Where an adverse decision is contemplated, hearing must be granted.

✔ Personal Hearing on Request

If taxpayer requests hearing in writing, officer must provide it.

✔ Speaking Order

Order must contain reasoning and discuss submissions made.

✔ Demand Cannot Exceed SCN

Tax cannot exceed amount specified in Show Cause Notice.

✔ Statutory Time Limits

Orders must be passed within prescribed limitation.

In simple terms, Section 75 prevents arbitrary tax demands.

Understanding Sections 73, 74, 74A — And How Section 75 Protects You

Before we understand the importance of Section 75, we must briefly see where it fits in the GST demand structure under the Central Goods and Services Tax Act, 2017.

Section 73 – Demand in Non-Fraud Cases

Section 73 applies when:

Tax is short paid
ITC is wrongly availed
Refund is wrongly taken
Without fraud or suppression

It is comparatively less stringent.

Key Features:

No fraud allegation
Lower penalty
Specific time limit for issuance of notice

Section 74 – Demand in Fraud / Suppression Cases

Section 74 applies when:

Fraud
Wilful misstatement
Suppression of facts
Intent to evade tax

It is more serious in nature.

Key Features:

Higher penalty (up to 100%)
Extended limitation period
Burden of allegation heavier

Section 74A – Consolidated Demand Provision (Recent Amendment)

Section 74A has been introduced to streamline demand provisions and reduce classification disputes between 73 and 74.

It attempts to:

Simplify demand structure
Bring uniformity
Reduce litigation

Now Comes Section 75 – The Procedural Backbone

Regardless of whether proceedings are under:

Section 73
Section 74
Section 74A

Section 75 applies to all of them.

It ensures:

✔ Opportunity of hearing
✔ Reasoned speaking order
✔ No excess demand beyond SCN
✔ Proper adjudication procedure
✔ Compliance with limitation

In simple terms:

Section 73, 74 and 74A create the demand.
Section 75 regulates how that demand must be adjudicated fairly.

Without Section 75 safeguards, proceedings would become arbitrary.

Why Courts Rely on Section 75

When High Courts quash GST orders, they generally find violation of:

Opportunity of hearing
Non-speaking orders
Mechanical adjudication
Demand beyond SCN
Ignoring written submissions

All these fall under procedural violations of Section 75.

Section 75 Safeguards in Brief:

Procedural Safeguards:
75(3) – Representation must be considered
75(4) – Hearing mandatory
75(5) – Adjournment limit
75(6) – Speaking order
75(7) – No excess demand
75(10) – Limitation compliance
Strategic / Practical Safeguards:
75(2) – Shift between 73 & 74
75(9) – Voluntary compliance benefit
75(11) – Wrong section not fatal

This is why Section 75 is becoming central in GST litigation.

Important High Court Judgments on Natural Justice

Several High Courts have consistently protected taxpayers where procedural safeguards were ignored. In Tvl. Suguna Cutpiece Centre opportunity of hearing is mandatory. Similarly, in Aggarwal Dyeing & Printing Works v. State of Gujarat (Gujarat High Court), it was held that vague show cause notices and mechanical orders violate principles of natural justice. The Delhi and Kerala High Courts have also repeatedly set aside orders where replies were not considered or hearing was denied.

🏛 Madras High Court

Tvl. Suguna Cutpiece Centre v. Appellate Deputy Commissioner (ST) (2022)

Madras High Court

Registration cancelled without proper hearing.
Court restored registration.
Held that opportunity of hearing is mandatory and cannot be bypassed.

This case is often cited in GST natural justice matters.

🏛 Gujarat High Court (Landmark Decision)

Aggarwal Dyeing & Printing Works v. State of Gujarat (2022)

Gujarat High Court

Show Cause Notice was vague.
Proper reasoning was absent.
Registration cancelled mechanically.

The Court held:

Vague notices and non-speaking orders violate principles of natural justice.

This judgment is widely relied upon across India.

🏛 Kerala High Court

Pournami Oil Mills v. State Tax Officer

Kerala High Court

Order passed without meaningful consideration of reply.
Matter remanded.
Court emphasized application of mind in adjudication.

🏛 Delhi High Court

Delhi High Court

In multiple cases, the Court has observed that:

Digital proceedings cannot override fairness.
Uploading notice on portal alone does not absolve authority of procedural compliance.
Adjudication must reflect reasoning.

Core Legal Principles Emerging

From these judgments, certain principles are clear:

Natural justice is mandatory in GST proceedings.
Hearing must be real and meaningful.
Orders must contain proper reasoning.
Mechanical adjudication violates Section 75.
Courts will intervene where due process is ignored.

Related reads on Finance Ki Baatein :-

GST order quashed for violation of natural justiceGST Orders Quashed for Violation of Natural Justice – No Hearing, No Reasoned Order (2026 Case Laws)

Section 73 of The CGST Act Section 73 of the CGST Act, 2017 – When GST Demands Collapse Due to Procedural Lapses (2026 High Court Rulings Explained)

GST registration cancellation GST Registration Cancellation Set Aside for Violation of Natural Justice

Practical Guidance for Taxpayers

If you receive a GST Show Cause Notice:

✔ File a detailed written reply
✔ Specifically request a personal hearing
✔ Maintain submission proof
✔ Attend the hearing seriously
✔ Download order immediately

If hearing was denied or reply ignored, strong grounds exist for appeal or writ petition.

Common Mistakes to Avoid

Ignoring SCN
Filing one-line replies
Missing appeal deadline
Not checking GST portal regularly
Assuming hearing is automatic

These small mistakes can cost heavily.

Conclusion – Way Forward

Section 75 is not a mere procedural formality. It embodies constitutional principles of fairness.

High Courts in 2026 are clearly reinforcing that:

Revenue collection must follow due process.

Taxpayers who act diligently and assert their procedural rights under Section 75 can successfully challenge arbitrary GST orders.

Natural justice remains the foundation of tax administration.

FAQ

Q1. Is personal hearing compulsory under Section 75?

Yes, if adverse decision is contemplated or requested in writing.

Q2. Can GST order be quashed for violation of natural justice?

Yes. Several High Courts have set aside such orders.

Q3. What if officer ignores my reply?

Such order may be challenged as non-speaking and violative of Section 75.

Q4. Can demand exceed SCN amount?

No. Section 75 restricts demand beyond SCN.

Disclaimer

This publication is intended solely for informational and educational purposes and does not constitute professional, legal, tax, or financial advice. The information provided has been compiled from sources believed to be reliable; however, its accuracy, completeness, or current relevance is not guaranteed. The views and opinions expressed herein reflect the author’s understanding at the time of publication and are subject to change without notice. Readers are strongly advised to seek independent professional advice before making any decision or taking any action based on the information contained in this publication. The author and publisher expressly disclaim any responsibility or liability for any loss, damage, or consequence arising directly or indirectly from reliance on this content or from any action taken or not taken based on it.