The Bombay High Court has granted ad-interim relief and stayed the operation of a refund rejection order after finding a prima facie case of violation of principles of natural justice as the GST officer gave only 7 days to reply instead of mandatory 15 days.
The bench of Justice Suman Shyam and Justice Advait M. Sethna has referred to the observations made by a coordinate bench in Golden Cryo Pvt. Ltd. v. Union of India & Ors. decided on March 12, 2026, indicating that the issues raised deserved serious consideration.
The petitioner challenged an order dated December 20, 2025, issued by GST authorities rejecting its refund application.
The petitioner contended that the refund rejection order was passed without considering its show-cause notice reply, even though the response had been submitted within the prescribed period. According to the petitioner, the authorities proceeded to decide the matter without taking into account the explanation already furnished, thereby causing serious prejudice.
Dr. Sujay Kamtawala, the Counsel appearing for the petitioner argued that the department had granted only seven days for filing a reply, which was contrary to the statutory framework and insufficient for an effective response. It was submitted that the failure to consider the reply rendered the impugned order legally unsustainable.
The Bench observed that the petitioner had made out a strong prima facie case warranting judicial intervention. The Court specifically referred to the observations made by a coordinate bench in Golden Cryo Pvt. Ltd. v. Union of India & Ors. decided on March 12, 2026, indicating that the issues raised deserved serious consideration.
The Bench noted that the challenge raised substantial questions regarding procedural fairness and compliance with statutory requirements in adjudication proceedings under the GST regime.
On behalf of the respondents, counsel sought time to obtain instructions and file a reply affidavit. Accepting the request, the High Court issued notice to the respondents and made the matter returnable on July 31, 2026. Since the respondents were represented before the Court, formal service of notice was dispensed with.
The Court granted ad-interim relief in favour of the petitioner. The Division Bench ordered that the operation of the impugned refund rejection order dated December 20, 2025, shall remain suspended until further orders. This effectively protects the petitioner from the consequences of the rejection while the writ petition remains pending adjudication.
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