GST Adjudication Quashed for Unreasonable Delay

The Assam Rifles Group Insurance Scheme challenged a GST show-cause order issued in October 2016, arguing that adjudication proceedings were unduly delayed. The scheme did not receive its first personal hearing until April 2024, and the final order was passed only in March 2025, some 3,081 days after the notice was issued.

The key question was whether the authorities breached the limitation period under Section 73(4B) of the Finance Act, 1994, by failing to complete adjudication “within a reasonable time.” The revenue invoked the extended period proviso on grounds of willful suppression, but the court found no justification for the delay.

Rejecting the respondents’ reliance on successive letters and representations as lawful tolling events under Section 33A, the court held that the tax authorities are duty‐bound to proceed expeditiously. Petitioners’ correspondence did not bar timely completion of proceedings.

In view of the unexplained and excessive delay, the court deemed the March 2025 order arbitrary and violative of the statute. The impugned order was set aside and the writ petition allowed.