Introduction
The year-end rush in GST adjudication proceedings has increasingly become a defining feature of departmental practice under Section 73 of the CGST Act. As limitation deadlines approach, taxpayers are often confronted with compressed timelines, last-minute document requisitions, and hearings fixed within days, sometimes hours, of the final adjudication order. The recent judgment of the Hon’ble Delhi High Court in Avik Televentures Pvt. Ltd. v. GST Officer, Department of Trade & Taxes, Delhi in W.P. (C) No.. 2339 of 2026, decided on 30.03.2026, addresses this procedural pattern directly and clarifies an important aspect of GST adjudication i.e. an opportunity of hearing under Sections 66 and 75 of the CGST Act must be meaningful in substance and not merely formal in appearance.
The judgment is significant not because it creates a new procedural safeguard, but because it applies existing statutory protections to a fact pattern that has become increasingly common in special audit proceedings. The Hon’ble Court’s analysis is particularly relevant for taxpayers facing adjudication proceedings nearing limitation expiry under Section 73(10), especially where extensive document requests are raised after replies to the Show Cause Notice have already been filed.
Background and procedural history
The petitioner in the case was engaged in the business of trading and exporting branded mobile phones and had been subjected to a special audit under Section 66 of the CGST/DGST Act for FY 2021-22. The special audit report was submitted in March 2025. Thereafter, the petitioner filed a response to the audit observations in April 2025, following which a Show Cause Notice was issued in September 2025. The petitioner filed a detailed reply together with supporting documentation within the timeline prescribed under the notice.
Following the filing of the reply, no further proceedings took place for approximately two months. Subsequently, on 27 December 2025 at approximately 5:20 PM, the department issued a communication styled as “Reminder-1” requiring the petitioner to furnish certified bank statements and substantial additional records by 29 December 2025, while simultaneously fixing a personal hearing for 30 December 2025. The intervening period included a Sunday.
The petitioner sought an adjournment in writing, requesting seven additional days to compile and furnish the material sought by the department. Despite the adjournment request, the proceedings continued. Representatives of the petitioner appeared before the adjudicating authority and also furnished an additional reply. However, on 31 December 2025, which was the final date available under the limitation period prescribed under Section 73(10), the adjudicating authority passed an Order-in-Original confirming a demand of approximately Rs. 26.72 crore towards tax, interest and penalty.
The petitioner challenged the order before the Hon’ble Delhi High Court primarily on the ground that the proceedings had been conducted in violation of the principles of natural justice and the statutory protections contained under Sections 66(4) and 75(4) of the CGST Act.
Statutory Framework considered by the Hon’ble Delhi Court
The Hon’ble Court’s analysis proceeded on the basis of three interrelated provisions under the CGST Act.
Section 66(4) provides that where material is gathered pursuant to a special audit, the registered person must be granted an opportunity of being heard in respect of such material before it is relied upon adversely. This safeguard assumes particular significance in special audit proceedings because the findings forming the basis of the proposed demand frequently emerge from extensive third-party examination and financial scrutiny conducted outside the ordinary assessment process.
Section 75(4) separately mandates that an opportunity of hearing must be granted where an adverse decision is contemplated or where a request for personal hearing is received in writing. In addition, Section 75(5) permits adjournments subject to a maximum limit of three adjournments during the proceedings.
The department relied upon the limitation contained in Section 75(5) together with the Hon’ble Supreme Court’s observations in MHJ Metaltechs Pvt. Ltd. v. CGST Delhi to contend that no vested right to adjournment exists under the statute and that the petitioner had, in any event, participated in the proceedings by appearing before the adjudicating authority and filing additional submissions.
The Hon’ble Court did not disagree with the proposition that adjournments are not guaranteed as a matter of right. However, it clarified that the issue before it was materially different. The question was not whether the petitioner was entitled to repeated adjournments, but whether the opportunity afforded by the department was capable of being effectively exercised at all in the factual circumstances of the case.
Meaningful opportunity of hearing under GST proceedings
The Hon’ble Court ultimately held that the proceedings failed to satisfy the statutory requirement of a meaningful and effective opportunity of hearing. Several aspects of the factual matrix weighed with the Hon’ble Court in arriving at this conclusion.
First, the Hon’ble Court considered the nature and volume of the documents sought by the department. The requisition included certified bank statements and extensive financial records which required compilation, certification and coordination with third parties. The Hon’ble Court observed that such documentation could not reasonably be gathered and furnished within the timeline effectively made available to the petitioner.
Second, the Hon’ble Court attached significance to the fact that the petitioner’s adjournment request was not disposed of at all. The record did not indicate either acceptance or rejection of the request, nor did it contain reasons explaining why additional time was not being granted. The Hon’ble Court treated this omission as procedurally significant because a failure to consider an adjournment request stands on a different footing from a reasoned rejection of such request.
Third, the Hon’ble Court considered the timeline between the hearing and the adjudication order. The Order-in-Original was passed immediately after the hearing and shortly after additional submissions had been furnished by the petitioner. While the Hon’ble Court stopped short of holding that the material had not been considered, it observed that the sequence of events gave rise to a legitimate apprehension regarding whether the submissions had received meaningful consideration before confirmation of liability.
Importantly, the Hon’ble Court rejected that participation in the hearing itself cured any procedural defect. The judgment recognises that participation under circumstances where an assessee faces the imminent risk of an ex parte order cannot automatically be treated as waiver or acquiescence, particularly where objections regarding insufficient time had already been placed on record.
Maintainability of the Writ Petition despite alternate remedy
The department objected to the maintainability of the writ petition on the ground that the petitioner had an alternate appellate remedy under Section 107 of the CGST Act. The Hon’ble Court rejected this contention and reiterated the settled position that the existence of an alternate statutory remedy does not preclude exercise of writ jurisdiction where proceedings are challenged on grounds of violation of principles of natural justice.
This aspect of the judgment is particularly important in GST adjudication matters because procedural defects at the original adjudication stage often cannot be meaningfully cured in appellate proceedings. The Hon’ble Court recognised that the grievance in such cases concerns not merely the correctness of the outcome, but the legality and fairness of the process by which the order was reached.
Parallel Proceedings and overlapping liability
Apart from the hearing-related challenge, the petitioner also argued that separate proceedings had been initiated for the same financial year and that another Order-in-Original passed on the same date had discharged the petitioner on issues overlapping with those forming the basis of the impugned demand.
Although the Hon’ble Court did not conclusively decide this issue, it directed the adjudicating authority to consider all contentions raised by the petitioner upon remand. The issue nevertheless remains significant because overlapping proceedings arising from special audit findings and separate departmental investigations have become increasingly common in GST litigation. The possibility of inconsistent findings across parallel proceedings raises substantial questions relating to procedural consistency and sustainability of demand confirmation.
AMLEGALS Remarks
The decision in Avik Televentures is likely to be relied upon in future challenges involving compressed adjudication timelines, especially in matters approaching statutory limitation deadlines. The judgment does not dilute the department’s powers to conduct adjudication proceedings expeditiously, nor does it create an unconditional right to adjournment. However, it reinforces the principle that procedural compliance under the CGST Act must be substantive and not merely technical.
The judgment also underscores the importance of maintaining a clear written record during adjudication proceedings. Taxpayers confronted with unrealistic timelines should ensure that requests for additional time are made in writing, that the nature of the documents sought and the practical difficulty in furnishing them are specifically identified, and that objections regarding procedural prejudice are contemporaneously recorded.
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