Failure to Fix a Date for Personal Hearing Invalidates GST Demand Order; HC Remands.

Issue

Whether a GST demand order passed under Section 73 (non-fraud) is legally valid if the adjudicating authority failed to fix any date for a personal hearing, and whether a subsequent appellate order dismissing the appeal as time-barred can be sustained.

Facts

An adjudicating authority passed an adverse assessment order against the petitioner under Section 73.
The authority never fixed a date for a personal hearing before passing the order.
The petitioner filed a statutory appeal against this order, but the appeal was dismissed by the appellate authority solely on the grounds of being time-barred.
The petitioner then filed a writ petition in the High Court, challenging both the original order (for breach of natural justice) and the appellate order (as consequential).
In court, the State (Revenue) admitted the fact that no date for a personal hearing had been fixed.

Decision

The High Court quashed and set aside both the impugned adjudication order and the appellate order.
It held that the failure to fix a date for a personal hearing is a fundamental violation of the principles of natural justice and the mandatory requirements of Section 75 of the CGST Act.
Relying on precedent (Mahaveer Trading Company), the court affirmed that a personal hearing is mandatory before any adverse order is passed.
The matter was remanded back to the assessing authority with a direction to pass a fresh order after providing the petitioner a proper opportunity of being heard.

Key Takeaways

Hearing is a Mandatory Right: The right to a personal hearing under Section 75 is a non-negotiable statutory safeguard. Passing an adverse order without even fixing a date for such a hearing is illegal.
Violation of Natural Justice: An order passed without affording a hearing is void for being in breach of the principles of natural justice.
Writ Petition is Maintainable: A writ petition is maintainable against an order that is void due to a fundamental breach of natural justice, even if the subsequent statutory appeal was dismissed on limitation. The dismissal on a technicality (delay) does not cure the fatal legal defect in the original order.
Department’s Admission is Fatal: The State’s admission that no hearing date was fixed left no room for factual dispute and made the order indefensible.

HIGH COURT OF ALLAHABAD

Jagjit Enterprises (P.) Ltd.

State of U.P.^*

Jaspreet Singh, J.

WRIT TAX No. 1159 of 2025

OCTOBER 17, 2025

Amrendra Verma for the Petitioner.

ORDER

1. Heard learned counsel for the petitioner and learned Standing Counsel for the State.

2. Present petition has been filed challenging the order dated 31.12.2023 passed under Section 73 of the U.P. Goods and Services Tax Act, 2017 (for short, ‘the GST Act’) as well as the order dated 23.09.2025 whereby the appeal was dismissed as being beyond limitation.

3. Contention of learned counsel for the petitioner is that no opportunity of hearing was granted while passing the order under Section 73 of the GST Act. It has also pointed out that in absence of any opportunity the order impugned cannot be sustained and this issue was dealt by the Division Bench of this Court passed in Writ Tax No.303 of 2024 Mahaveer Trading Company v. Deputy Commissioner, State Tax (All)/2024:AHC:38820-DB.

4. Learned Standing Counsel, on the basis of the instructions, states that in so far as the issue of opportunity of hearing is concerned, no date was fixed for personal hearing.

5. Before adverting to the aforesaid submissions it will be appropriate to notice the observations made by the Division Bench of this Court in Mahaveer Trading Company (supra) wherein in paras-5 to 11 it was held that under:

“5. It is basic to procedural law under taxing statutes that opportunity of personal hearing must be provided to an assessee before any assessment/adjudication order is passed against him. Thus, we find it strange and wholly unacceptable merely because the substantive law has changed, the revenue authorities have changed their approach and are failing to observe that mandatory requirement of procedural law. They have thus denied opportunity of hearing to the assessee.

6. Section 75(4) of the Act reads as below:

“An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.”

7. Perusal of the impugned order reveals, the petitioner appeared before the competent authority on three dates. With respect to those dates, the impugned order reads as below:

8. Thus, it is established on record that on all three dates, the petitioner had been called to file its reply on the points specified in the respective show-cause notice issued. The petitioner submitted its reply on each occasion. Those replies have been extracted in the impugned order. After recording the reply submitted on 27.10.2022, the adjudicating authority has chosen to deal with the merits of the replies submitted and passed a merit order.

9. It transpires from the record, neither the adjudicating authority issued any further notice to the petitioner to show cause or to participate in the oral hearing, nor he granted any opportunity of personal hearing to the petitioner.

10. On query made, the learned Additional Chief Standing Counsel fairly submits, in light of similar occurrences, noticed in other litigation, he had apprised the Commissioner, Commercial Tax. In turn, the Commissioner, Commercial Tax, Uttar Pradesh, has issued Office Memo No. 1406 dated 12.11.2024. The same has been addressed to all Additional Commissioner to be communicated to all field formations for necessary compliance. A copy of the same has been made available to this Court. It reads as below:

“1. The column in which date of personal hearing has to be mentioned, only N.A. is mentioned without mentioning any date.

2. The column in which time of personal hearing has to be mentioned, only N.A. is mentioned without mentioning time of hearing.

3. In some cases, the date of personal hearing is prior to which reply to the Show Cause Notice has to be submitted this is non-est and this practice has to be discontinued. The date of reply to the Show Cause Notice has to be definitely prior to the date of personal hearing.

4. In some cases, the date of personal hearing is on the same date to which reply to the Show Cause Notice has to be submitted-this is non-est and this practice has to be discontinued. The date of reply to the Show Cause Notice has to be definitely prior to the date of personal hearing.

5. In all cases observed, the date of passing order either u/s 73(9)/74(9) etc. of the Act is not commensurate to the date of personal hearing. It is trite law that the date of the order has to be passed on the date of personal hearing. For eg., the date of furnishing reply to SCN is 15.11.2023 and date of personal hearing is 17.11.2023, then the date of order has to be 17.11.2023”

11. In view of the facts noted above, before any adverse order passed in an adjudication proceeding, personal hearing must be offered to the noticee. If the noticee chooses to waive that right, occasion may arise with the adjudicating authority, (in those facts), to proceed to deal with the case on merits, ex-parte. Also, another situation may exist where even after grant of such opportunity of personal hearing, the noticee fails to avail the same. Leaving such situations apart, we cannot allow a practice to arise or exist where opportunity of personal hearing may be denied to a person facing adjudication proceedings. “

6. Since the aforesaid dictum is applicable in the present facts and circumstances, accordingly, the impugned orders cannot be sustained and the orders dated 31.12.2023 & 23.09.2025 are accordingly quashed.

7. With the aforesaid, the present petition is allowed.

8. Matter is remanded to the assessing authority to pass fresh order after giving an opportunity of hearing to the petitioner