Facts of the Case

M/s The Times Idea challenged an order dated 22.12.2023 passed under Section 73 of the GST Act and the subsequent appellate order dated 30.11.2024 dismissing its appeal, before the Allahabad High Court, Lucknow Bench. The petitioner's counsel argued that the show cause notice had listed the date for personal hearing earlier than the date fixed for filing the reply, leaving no real opportunity to be heard. The State's counsel pointed out that in the reply actually submitted, the petitioner had itself selected 'No' for personal hearing, so no separate hearing was denied by the department's own conduct.

Issues Involved

  1. Whether the mismatched hearing-and-reply dates in the show cause notice vitiated the proceedings regardless of the assessee's own election against a personal hearing.
  2. Whether the precedents in Mahaveer Trading Company and Bharat Mint and Allied Chemicals applied squarely to these facts.

Petitioner's Arguments

  • No genuine opportunity of hearing was afforded because the notice fixed the hearing date before the reply deadline, a defect already condemned by this Court in Mahaveer Trading Company vs. Deputy Commissioner, State Tax (Writ Tax No. 303 of 2024).
  • The same defect had also been addressed in Bharat Mint and Allied Chemicals v. Commissioner Commercial Tax & Ors.; 2022 (4) ADJ 75, supporting quashing of the order.

Respondent's Arguments

  • The petitioner had itself opted 'No' for personal hearing in its reply to the show cause notice, so the department could not be faulted for not scheduling one separately.

Court Order / Findings

  • The Court, following its own precedents in Mahaveer Trading Company and Bharat Mint and Allied Chemicals, held that the sequencing defect in the notice was sufficient on its own to vitiate the proceedings, irrespective of the assessee's subsequent election on hearing.
  • Both the assessment order dated 22.12.2023 and the appellate order dated 30.11.2024 were quashed, and the matter was remanded to the assessing authority to pass a fresh order after granting an opportunity of hearing.

Important Clarification

  • A defective show cause notice that fixes the hearing date ahead of the reply date is treated as a standalone ground for quashing a Section 73 order, even where the assessee later declines a personal hearing in its reply.
  • This line of Allahabad High Court rulings (Mahaveer Trading Company, Bharat Mint) is now routinely applied as a template ground across similarly worded U.P. GST show cause notices.

Sections Involved

  • Section 73, CGST/UPGST Act, 2017 – governs the notice-reply-hearing procedure for non-fraud tax demands.
  • Section 107, CGST Act, 2017 – governs the statutory first appeal against a Section 73 order.

Decision – In Favour of

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

Case Details

Court: High Court of Judicature at Allahabad, Lucknow Bench. Case No.: Writ Tax No. 948 of 2025. Coram: Hon'ble Mr. Justice Pankaj Bhatia. Date of Order: 17th September, 2025.

Link to Download the Order

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