Jaipur: In a significant ruling, the Rajasthan High Court has held that while GST dues can be recovered from the legal heirs of a deceased taxpayer, authorities cannot proceed without first issuing them a notice and providing an opportunity of hearing.
The Court quashed two GST assessment orders passed against a deceased sole proprietor, holding that the mandatory procedure under the CGST Act had not been followed.
The petition was filed by Chotu Devi, wife and legal heir of late Hansa Ram Choudhary, proprietor of M/s Shri Satguru Marbles Industry, who died on December 30, 2025.
Despite his death, the GST Department passed an order under Section 74 of the CGST Act on December 31, 2025, followed by an original order on March 26, 2026, raising tax, interest and penalty demand against him.
The petitioner argued that no notice was issued to her and she was never given an opportunity to contest the proceedings before the orders were passed, rendering them illegal.
The State contended that Section 93 of the CGST Act permits recovery of outstanding tax liabilities from the legal representatives of a deceased taxpayer.
The High Court agreed that the tax liability survives the taxpayer’s death but clarified that such recovery must comply with Section 75 of the Act, which mandates a fair hearing and a reasoned order before any adverse decision is taken.
Observing that Chotu Devi was never served with an independent notice despite being the legal representative, the Division Bench of Justice Arun Monga and Justice Ashutosh Kumar held that the assessment proceedings violated the principles of natural justice and the statutory safeguards under the CGST Act.
Allowing the writ petition, the Court set aside both GST orders and granted liberty to the authorities to issue a fresh notice to the petitioner and complete the assessment afresh after giving her a proper opportunity of hearing