Facts of the Case

M/S Jay Maa Durge Traders challenged an order dated 05.02.2025 passed under Section 73 of the UP Goods and Services Tax Act, along with the subsequent order dated 30.09.2025 dismissing its appeal as time-barred. The core grievance was that although the petitioner had appeared and submitted written explanations to the show cause notice on three separate dates (23.09.2022, 07.10.2022 and 27.10.2022), the adjudicating authority proceeded to decide the matter on merits without issuing any further notice or granting any opportunity of personal hearing before passing the adverse order — a defect the Allahabad High Court had already examined in detail in a coordinate Division Bench ruling in Mahaveer Trading Company v. Deputy Commissioner, State Tax.

Issues Involved

  1. Whether passing an adverse GST assessment order without granting a personal hearing, despite the assessee having filed written replies on multiple occasions, violates Section 75(4) of the GST Act.
  2. Whether systemic defects in fixing personal hearing dates — such as marking them 'N.A.' or scheduling them before or on the same date as the reply deadline — vitiate the resultant orders.
  3. Whether both the original assessment order and the subsequent time-barred appellate dismissal should be quashed and the matter remanded for a fresh opportunity of hearing.

Petitioner's Arguments

  • The petitioner contended that no opportunity of personal hearing was ever granted before the Section 73 order was passed, even though it had filed detailed replies to the show cause notice on three occasions.
  • Reliance was placed on the Division Bench ruling in Mahaveer Trading Company (2024:AHC:38820-DB), which held that Section 75(4) mandates a personal hearing wherever an adverse decision is contemplated, regardless of whether the assessee has separately filed written replies.

Respondent's Arguments

  • The Additional Chief Standing Counsel, on instructions, fairly conceded that no date was fixed for personal hearing in the case, effectively not disputing the core factual premise of the challenge.

Court Order / Findings

  • The Court reproduced at length its reasoning in Mahaveer Trading Company, holding that Section 75(4) mandates a personal hearing wherever an adverse decision is contemplated, and that mere filing of written replies on notice does not substitute for this mandatory opportunity; it also placed on record an Office Memo No.1406 dated 12.11.2024 issued by the UP Commissioner of Commercial Tax to all field formations, flagging systemic defects — hearing dates marked 'N.A.', hearing dates preceding or coinciding with the reply deadline, and orders dated inconsistently with the actual hearing date — and directing these practices to be discontinued.
  • Applying this dictum, the Court held that since neither a further notice nor any opportunity of personal hearing was granted to the petitioner before the adverse order was passed, both the original order dated 05.02.2025 and the appellate dismissal dated 30.09.2025 could not be sustained and were accordingly quashed.
  • The matter was remanded to the assessing authority to pass a fresh order after giving the petitioner a proper opportunity of hearing, in line with the corrective directions already issued by the State's own Commissioner of Commercial Tax.

Important Clarification

  • Section 75(4) of the GST Act makes a personal hearing mandatory whenever an adverse decision is contemplated against the taxpayer, or upon a written request — filing replies to the show cause notice does not dispense with this separate procedural safeguard.
  • The Allahabad High Court has placed on judicial record the UP Commissioner of Commercial Tax's own Office Memo (No.1406 dated 12.11.2024) acknowledging systemic lapses across field formations in fixing personal hearing dates, and directing corrective compliance.
  • Where such a personal-hearing defect is established, courts will quash both the original assessment and any consequential appellate dismissal for delay, restoring the matter for a hearing-compliant fresh order.

Sections Involved

  • Section 75(4) of the Central/Uttar Pradesh Goods and Services Tax Act, 2017 – mandates a personal hearing wherever a written request is received or an adverse decision is contemplated, the crux of this ruling.
  • Section 73 of the UPGST Act, 2017 – governs the original demand order under challenge.

Decision – In Favour of

In favour of the assessee — both the assessment and appellate orders were quashed for denial of personal hearing, with the matter remanded for a fresh, hearing-compliant order.

Case Details

Court: High Court of Judicature at Allahabad, Lucknow Bench
Case No.: Writ Tax No. 1240 of 2025
Coram: Hon'ble Jaspreet Singh, J.
Date of Order: 10.11.2025

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