Facts of the Case

M/S Ikon Lubes India Private Ltd challenged an order dated 08.04.2025 passed under Section 74(9) of the UPGST/CGST Act and the underlying show cause notice dated 05.12.2024 issued under Section 74(1) for the period April 2018 to March 2019 (FY 2018-19), before the High Court of Judicature at Allahabad. The petitioner's grievance was twofold: that the final order traveled beyond the scope of the show cause notice, and that certain documents relied upon by the department in passing the order had not been supplied to the petitioner despite being sought. The Division Bench heard and decided the matter on 15.09.2025.

Issues Involved

  1. Whether an adjudication order under Section 74(9) that goes beyond the scope of the show cause notice violates Section 75(7) of the UPGST Act.
  2. Whether failure to supply relied-upon documents sought by the petitioner vitiates the order for denial of a fair opportunity to respond.
  3. What relief should follow such twin defects.

Petitioner's Arguments

  • The impugned order dated 08.04.2025 traveled beyond the scope and grounds set out in the show cause notice dated 05.12.2024, in violation of Section 75(7) of the UPGST Act, which restricts the adjudicating authority from confirming demand on grounds not specified in the notice.
  • Certain documents relied upon by the department in passing the order had been specifically sought by the petitioner but were never supplied, denying a fair opportunity to rebut the case against it.

Respondent's Arguments

  • The order does not record any specific defence by the State to the twin contentions of exceeding the SCN and non-supply of relied-upon documents; the reliefs granted reflect that these contentions were accepted.

Court Order / Findings

  • Upon perusal of the show cause notice and the impugned order, the Court found that the impugned order had indeed gone beyond the show cause notice and was accordingly in violation of Section 75(7) of the UPGST Act.
  • The Court further found that certain relied-upon documents sought by the petitioner had not been supplied to it.
  • In light of these twin defects, the Court quashed and set aside the impugned order, directing the State GST Department to supply the relied-upon documents to the petitioner within two weeks, and to grant an opportunity to file a fresh reply after such supply.
  • Thereafter, the authority was directed to pass a reasoned order only after granting the petitioner an opportunity of personal hearing.
  • The writ petition was disposed of with these directions.

Important Clarification

  • An adjudication order under Section 74 that travels beyond the specific grounds and allegations set out in the show cause notice violates Section 75(7) of the UPGST/CGST Act and is liable to be quashed on that ground alone.
  • Failure to supply documents relied upon by the department, despite being specifically sought by the assessee, independently vitiates the adjudication for denial of a fair opportunity to respond.
  • Where both defects are present, courts direct a structured remedy — supply of documents, a fresh reply window, and a personal hearing — before any fresh reasoned order is passed, rather than simply remanding without safeguards.

Sections Involved

  • Section 74, CGST/UPGST Act, 2017 — determination of tax not paid or short paid by reason of fraud, wilful misstatement or suppression of facts.
  • Section 75(7), CGST/UPGST Act, 2017 — prohibits the adjudicating authority from confirming demand on grounds not specified in the show cause notice.

Decision – In Favour of

Decided in favour of the assessee. The Section 74(9) order was quashed for exceeding the show cause notice and for non-supply of relied-upon documents, with a structured document-supply, reply, and hearing process directed before re-adjudication.

Case Details

Court: High Court of Judicature at Allahabad
Case No.: Writ Tax No. 2915 of 2025
Coram: Hon'ble Mr. Justice Shekhar B. Saraf and Hon'ble Mr. Justice Praveen Kumar Giri
Date of Decision: 15.09.2025

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