Facts of the Case

M/S Mechanical Spares And Services, through its proprietor Sandhya Kumari, challenged an order dated 23.08.2024 passed under Section 73 of the GST Act, 2017, along with the order dated 05.03.2025 rejecting its rectification application and the order dated 23.06.2025 dismissing its appeal as barred by limitation. The petitioner's grievance was that no opportunity of hearing had been granted before the Section 73 order was passed. The Allahabad High Court, Lucknow Bench, per Justice Pankaj Bhatia, decided the writ petition on 10 September 2025, applying the ruling in Mahaveer Trading Company v. Deputy Commissioner State Tax (Writ Tax No. 303 of 2024, decided 04.03.2024).

Issues Involved

  1. Whether a Section 73 order is sustainable where the reminder notice preceding it fixed no date for personal hearing at all, in violation of Section 75(4) of the GST Act.
  2. Whether the consequent rejection of the rectification application and the time-barred dismissal of the appeal should also be set aside.
  3. Whether the matter should be remanded for fresh adjudication with a proper hearing opportunity.

Petitioner's Arguments

  • No opportunity of hearing was granted while passing the order under Section 73 of the GST Act, in violation of the mandatory hearing safeguard.
  • Sought quashing of the Section 73 order, the rejection of its rectification application, and the dismissal of its appeal on limitation, together with a remand for fresh adjudication with proper hearing.

Respondent's Arguments

  • Learned Standing Counsel, on instructions, candidly stated that the reminder notice issued to the petitioner did not fix any date for personal hearing at all.

Court Order / Findings

  • The Court found the impugned order violative of Section 75(4) of the GST Act, which mandates an opportunity of hearing before an adverse order, since the reminder notice preceding the order fixed no hearing date whatsoever.
  • Where a reminder notice preceding a Section 73 order fails to fix any date for personal hearing, the resulting order is violative of Section 75(4) of the GST Act and must be quashed along with any consequential rectification-rejection and appellate orders founded on it, applying the ratio in Mahaveer Trading Company.
  • Finding the issue squarely covered by Mahaveer Trading Company v. Deputy Commissioner State Tax, the Court quashed the impugned order dated 23.08.2024, the rectification-rejection order dated 05.03.2025, and the appellate order dated 23.06.2025 dismissing the appeal as time-barred, along with a further connected order dated 29.04.2024, and allowed the writ petition.
  • The matter was remanded to the Assessing Authority to pass a fresh order, in accordance with law, after providing adequate opportunity of hearing.

Important Clarification

  • Section 75(4) of the GST Act makes an opportunity of personal hearing mandatory before any adverse order is passed, and a reminder notice that fixes no hearing date at all is a clear breach, not a mere technical lapse.
  • Such a breach vitiates the entire subsequent chain — the original order, any rectification-rejection, and an appellate dismissal on limitation — entitling the taxpayer to a full remand with a fresh, properly-notified hearing, rather than being limited to correcting only the specific order under challenge.

Sections Involved

  • Section 73, GST Act, 2017 — determination of tax not paid/short paid other than by reason of fraud.
  • Section 75(4), GST Act, 2017 — mandatory opportunity of hearing before an adverse adjudication order.

Decision – In Favour of

Assessee (petitioner) — all impugned orders quashed and the matter remanded for fresh adjudication with a proper hearing.

Case Details

Court: High Court of Judicature at Allahabad, Lucknow Bench. Case No.: Writ Tax No. 826 of 2025. Coram: Hon'ble Pankaj Bhatia, J. Date of Order: 10 September 2025.

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