Facts of the Case

M/s Descon Infrastructures Pvt. Ltd. challenged an order dated 05.12.2023 passed under Section 73 of the U.P. GST Act, along with the subsequent appellate order dated 17.06.2025 dismissing its appeal as time-barred. Before the Allahabad High Court, Lucknow Bench, the petitioner's grievance was that the show cause notice had scheduled the date for personal hearing earlier than the date fixed for filing the reply, meaning the petitioner never had a real opportunity to be heard before the demand was confirmed. The State's standing counsel, on instructions, confirmed this sequencing defect in the notice.

Issues Involved

  1. Whether a show cause notice under Section 73 that fixes the personal hearing date before the date for filing a reply denies the assessee a fair opportunity of hearing.
  2. Whether such a defect, once established, justifies quashing both the assessment order and the limitation-barred appellate dismissal.

Petitioner's Arguments

  • No genuine opportunity of hearing was granted before the Section 73 order was passed, because the hearing date in the show cause notice preceded the reply deadline.
  • The identical issue had already been decided in the petitioner's favour by this Court in Mahaveer Trading Company vs. Deputy Commissioner, State Tax and Anr. (Writ Tax No. 303 of 2024, decided 04.03.2024), and the same relief should follow.

Respondent's Arguments

  • The State's Standing Counsel, on instructions, confirmed that the show cause notice indeed fixed the personal hearing date earlier than the date given for filing the reply.

Court Order / Findings

  • The Court found the sole ground raised — the mismatched dates in the show cause notice — sufficient to vitiate the proceedings, following its own binding precedent in Mahaveer Trading Company.
  • Both the original order dated 05.12.2023 and the appellate order dated 17.06.2025 were quashed, and the matter was remanded to the assessing authority to pass a fresh order after granting a proper opportunity of hearing.

Important Clarification

  • A show cause notice under Section 73 must fix the personal hearing date after, not before, the date allowed for filing a reply; sequencing it otherwise denies a meaningful opportunity to be heard.
  • This procedural defect alone is sufficient to set aside both the assessment order and any appellate order that dismissed the challenge on limitation grounds, without going into the merits of the tax demand.

Sections Involved

  • Section 73, CGST/UPGST Act, 2017 – governs determination of tax not paid or short paid in non-fraud cases, and the associated procedure of notice, reply and hearing.
  • Section 107, CGST Act, 2017 – governs the statutory appeal, including limitation, from a Section 73 order.

Decision – In Favour of

The writ petition was allowed in favour of the assessee, with both impugned orders quashed and the matter remanded for a fresh order after a proper hearing.

Case Details

Court: High Court of Judicature at Allahabad, Lucknow Bench. Case No.: Writ Tax No. 838 of 2025. Coram: Hon'ble Mr. Justice Pankaj Bhatia. Date of Order: 28th August, 2025.

Link to Download the Order

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