DRC 07 issued without 3 Reminders, Goods and Services Tax - GST

[Bhavy Dhawan]

Dear Members,

We were in receipt of a SCN in DRC 01 for FY 2020-21 dated 22.11.2024. First reminder against it was issued with due date 14.01.2025. A reply seeking adjournment/extension of one week was filed on 14.01.2025 itself.

Prior to this no reply was filed by us due to negligence and miscommunications by the consultants. Also, no second and third reminders were issued by the department and direct order in DRC 07 was issued dated 22.02.2025. Also, in the attachment of DRC 07, a statement is mentioned that we have not sought any adjournment, which is not correct.

Is giving three reminders before issuing DRC 07 mandatory under Gst law? Please mention relevant sections, if possible.

Also what can be our course ahead in such a case? Can appeal be filed or is their any other way because pre deposit amount will be 4.6 lacs?

Kindly provide your expert opinions on what can be done in such a case.

Thanks.

Posts / Replies

[KASTURI SETHI]

The Adjudicating Authority is   statutorily bound to grant three adjournments (four opportunities for personal hearing) as per Section 75 (5) of CGST Act before passing the adjudication order. 

Adjudicating the SCN by granting one opportunity instead of four is  in violation of principles of natural justice.

Personal hearing cannot be granted before filing reply to the SCN--------Madras High Court  inn the case of Shree Shyam Granites and Marbles reported as 2023(73)GSTL.61.

You can  apply for rectification of error under Section 161.The error is apparent on the face of record. Read Section 161 carefully.  Thus pre-deposit will be saved.

    You will have to pursue the rectification application so that appeal period may not expire. 

    There is a judgment regarding exclusion of the period consumed in the passing   rectification order by the department.