Facts of the Case

M/s Shelindra Kumar Chaturvedi Cons challenged an Adjudication Order dated 19.03.2025 passed under Section 74 of the GST Act, 2017, creating a demand of tax of Rs.19,81,316 for FY 2018-19. The petitioner contended that no show-cause notice was ever properly issued, and that no date for filing a reply or attending a personal hearing was ever communicated before the order was passed; the very date of service of the adjudication order was also in dispute.

Issues Involved

  1. Whether an adjudication order can be sustained where notices and orders are served only through the online GST portal, without effective alerts or visibility to the assessee.
  2. Whether the rigid limitation period for appeals, coupled with the appellate authority's lack of power to remand, justifies direct writ intervention notwithstanding an available statutory remedy.

Petitioner's Arguments

  • No show-cause notice or opportunity of hearing was ever effectively communicated before the adverse order.
  • The date of service of the adjudication order itself was doubted, undermining the department's claim of proper communication.

Respondent's Arguments

  • There was some merit conceded by the Bench itself in noting that facts may be otherwise, but the State did not seriously dispute the systemic pattern of portal-based service failures noticed across numerous similar petitions.

Court Order / Findings

  • The Court recorded that hundreds, if not thousands, of similar petitions had arisen from the same or similar defects — online notices/orders not visible on the GST portal, a rigid limitation period with limited condonation power, and appellate authorities lacking the power to remand — collectively depriving assessees of an effective right of appeal.
  • Following Mahaveer Trading Company v. Deputy Commissioner, State Tax and M/S Shubham Steel Traders v. State of U.P., the Court held natural justice mandates either passing the order on a fixed hearing date or communicating any adjourned date — failure to do so forces an ex-parte outcome on the assessee by the authority's own conduct.
  • The order was allowed and the impugned order set aside, subject to the petitioner depositing Rs.20,000 within one month.
  • A detailed timed procedure was prescribed: supply of the SCN and Relied Upon Documents within two weeks of compliance, reply within a further four weeks, a fresh hearing date with at least two weeks' notice, and completion of proceedings within six months of first compliance.

Important Clarification

  • Where the Court itself records a systemic, portal-driven pattern of natural justice violations affecting large numbers of assessees, a conditional remand with a fixed compliance timeline — rather than an unconditional quashing — has emerged as the standard remedy in the Allahabad High Court.
  • An appellate authority's lack of power to remand under the GST Act is treated as a material factor in favour of exercising writ jurisdiction directly, rather than relegating the assessee to the statutory appeal.

Sections Involved

  • Section 74 of the GST Act, 2017 — determination of tax involving fraud, wilful misstatement or suppression.
  • Principles of natural justice in GST adjudication — requirement of effective notice and personal hearing before an adverse order.

Decision – In Favour of

In favour of the Assessee — the order was set aside conditional on a Rs.20,000 deposit, with a detailed timeline for a fresh, contested adjudication.

Case Details

Court: High Court of Judicature at Allahabad — Case No.: Writ Tax No. 5071 of 2025 — Coram: Hon'ble Justices Saumitra Dayal Singh and Indrajeet Shukla — Date of Order: 10 October 2025.

Link to Download the Order

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