Facts of the Case

M/S Sarojani Associates, the petitioner, challenged an adjudicating order dated 29.04.2024 passed under Section 73 of the GST Act, 2017, raising a tax demand of Rs 39,48,390/-. The petitioner's case was that the first show cause notice itself was defective: it fixed a hearing date of 06.01.2024, which fell before the date the reply was filed (22.01.2024). During the proceedings a supplementary notice dated 24.04.2024 proposed an additional demand, but that notice was allegedly time-barred and, in any case, granted only three days for a final hearing fixed for 27.04.2024. The impugned order was ultimately passed two days after that hearing date, on 29.04.2024. The petitioner explained the delay in approaching the Court by stating that the order was never served on it physically, while the Revenue maintained that service had been effected online.

Issues Involved

  1. Whether an adjudication order passed under Section 73 can stand when the first show cause notice fixed a hearing date earlier than the date prescribed for filing the reply.
  2. Whether a supplementary notice raising an additional demand, granting only three days for hearing, satisfies the requirement of adequate opportunity of hearing.
  3. Whether the delay in filing the writ petition, attributable to disputed facts on service of the order, bars interference at the writ stage.

Petitioner's Arguments

  • The first notice fixed the hearing date before the reply filing date, making the process procedurally defective from the outset.
  • The supplementary notice dated 24.04.2024 proposing additional demand was itself time-barred.
  • Only three days were granted to respond to the supplementary notice, which raised a fresh issue, denying adequate opportunity of hearing.
  • The impugned order, though listed for a hearing on 27.04.2024, was actually passed two days later without further notice.

Respondent's Arguments

  • The impugned order is appealable, and since the petitioner did not file a statutory appeal within the prescribed limitation, no interference should be granted at the writ stage.
  • The order was duly served on the petitioner through the online mode via the GST portal.

Court Order / Findings

  • The Court found that defects in the proceedings were writ large on the face of the record — fixing a hearing date before the reply due date, and granting barely three days on a notice that raised a new issue, was procedurally unsound.
  • Adjudicating authorities exercising quasi-judicial power must pass reasoned orders following a procedure that genuinely affords the noticee an opportunity of hearing, especially where the order creates civil liability.
  • Since no useful purpose would be served in keeping the petition pending for a counter affidavit, the Court proceeded to decide the matter directly.
  • The impugned order dated 29.04.2024 was set aside, subject to the petitioner depositing Rs 4,00,000/- within one month.
  • On such deposit, the petitioner was permitted to file its reply to the second (supplementary) notice within a further month, after which the authority must fix and communicate a fresh hearing date through the regular mode and conclude proceedings expeditiously, preferably before 31.03.2026.

Important Clarification

  • A show cause notice that schedules the personal hearing before the statutory or notified date for filing a reply is procedurally defective and vitiates the resulting order.
  • A supplementary notice raising a fresh or additional demand must give the noticee a realistic opportunity — three days on a new issue is treated by the Court as inadequate.
  • Adjudication orders that create civil liabilities must be preceded by transparent, real (not paper) compliance with natural justice, including advance intimation of the hearing date.

Sections Involved

  • Section 73, CGST Act, 2017 — determination of tax not involving fraud/suppression.
  • Section 75, CGST Act, 2017 — general provisions relating to determination of tax, including the requirement of a fair hearing.

Decision – In Favour of

Disposed of with directions, in favour of the Assessee — the demand order is set aside and the matter remanded for a fresh, procedurally compliant adjudication, conditional upon a Rs 4,00,000 deposit.

Case Details

High Court of Judicature at Allahabad; Writ Tax No. 5137 of 2025; Coram: Hon'ble Saumitra Dayal Singh, J. and Hon'ble Indrajeet Shukla, J.; Order dated 07.10.2025.

Link to Download the Order

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