Facts of the Case

M/S Kisan Brick Field challenged an order dated 16.02.2025 raising a demand of Rs.3,47,37,094/- for financial year 2022-23, and the subsequent appellate order dated 08.10.2025 rejecting its appeal on grounds of delay. The petitioner had been issued a show-cause notice dated 11.11.2024 under Section 74 of the GST Act, 2017, in GST DRC-01, which called upon it to show cause why tax, penalty and interest of Rs.2,87,08,342.56/- should not be imposed. As this notice (and the subsequent reminder) was uploaded on the 'Additional Notices and Orders' tab, the petitioner remained unaware of it and did not respond, leading to the impugned order confirming a substantially higher demand of Rs.3,47,37,094/-.

Issues Involved

  1. Whether a final order can lawfully confirm a demand exceeding the amount of tax, interest and penalty specified in the underlying show-cause notice.
  2. Whether the personal-hearing-column being marked 'NA' independently vitiates the order.

Petitioner's Arguments

  • The demand of Rs.3,47,37,094/- confirmed in the impugned order exceeded the Rs.2,87,08,342.56/- specified in the show-cause notice, in violation of Section 75(7) of the Act.
  • The column for date of personal hearing was marked 'NA' in both the notice and the reminder, in violation of principles of natural justice.

Respondent's Arguments

  • The petitioner, despite the notice and reminder, chose not to file a response, so passing of the order could not be said to violate natural justice.
  • Charging interest and penalty is a statutory consequence, and the fact that the exact figure was not indicated in the show-cause notice would not take away the authority's power to demand interest and penalty in accordance with law.

Court Order / Findings

  • The Court examined Section 75(7), which mandates that "the amount of tax, interest and penalty demanded in the order shall not be in excess of the amount specified in the notice and no demand shall be confirmed on the grounds other than the grounds specified in the notice."
  • It found that the show-cause notice specified Rs.2,87,08,342.56/- as the composite figure of tax, interest and penalty, whereas the demand raised in the impugned order was Rs.3,47,37,094/- — a figure ex facie contrary to Section 75(7).
  • On the personal hearing plea, the Court held that since the petitioner's own case was that it was unaware of the notice altogether, the fact that a hearing date was shown as 'NA' lost its significance and did not, by itself, vitiate the notice.
  • On account of the violation of Section 75(7), the impugned orders dated 16.02.2025 and 08.10.2025 were quashed and set aside, and the matter remanded to provide the petitioner an opportunity to respond to the show-cause notice and a hearing before a fresh order.

Important Clarification

  • Section 75(7) of the CGST/UPGST Act imposes a hard cap: the tax, interest and penalty ultimately confirmed in an adjudication order cannot exceed the composite figure specified in the show-cause notice, nor can the order travel beyond the grounds specified in the notice — any order breaching this cap is liable to be quashed regardless of whether the assessee responded to the notice.

Sections Involved

  • Section 74, GST Act, 2017 – determination of tax not paid by reason of fraud or suppression.
  • Section 75(7), GST Act, 2017 – bar on the confirmed demand exceeding the amount, or grounds, specified in the show-cause notice.

Decision – In Favour of

Decided in favour of the Assessee. Impugned orders quashed for exceeding the show-cause notice amount, remanded for fresh proceedings.

Case Details

  • Court: High Court of Judicature at Allahabad, Lucknow Bench
  • Case No.: Writ Tax No. 1310 of 2025
  • Coram: Hon'ble Jaspreet Singh, J.
  • Date of Order: 14 November 2025

Link to Download the Order

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