Ex Parte Order Quashed for Being Passed on Non-Notified Date Without Hearing

Issue

Whether an adjudication order passed under Section 74 of the GST Act is legally valid if it is passed ex parte on a date different from the one fixed for the personal hearing, without issuing any fresh notice to the taxpayer for the subsequent date.

Facts

The Order: The Deputy Commissioner (State GST) passed an ex parte order dated 17.05.2025 under Section 74 against the petitioner.
The Procedural Lapse:
- A specific date had been fixed for the personal hearing.
- The order was not passed on that scheduled date.
- Crucially, the officer did not issue or communicate any notice for a subsequent date to the petitioner.
The Result: The final order was passed on a later date behind the petitioner’s back, denying them the opportunity to be heard.
The Challenge: The petitioner filed a writ petition, arguing that this procedure violated the principles of natural justice.

Decision

The Allahabad High Court ruled in favour of the assessee.
Violation of Natural Justice: The Court held that passing an order on a date other than the fixed hearing date, without notifying the assessee of the new date, is a clear violation of the principles of natural justice and the statutory mandate of Section 75(4).
Quashing of Order: Consequently, the impugned ex parte order dated 17.05.2025 was quashed.
Remand: The matter was remanded back to the Deputy Commissioner with a specific direction to grant a personal hearing to the petitioner and then pass a fresh, reasoned order in accordance with the law.

Key Takeaways

Fresh Notice is Mandatory: If a hearing is adjourned or if the officer does not pass an order on the scheduled hearing date, they must issue a fresh notice fixing a new date and time.
No Orders Behind the Back: An authority cannot close proceedings on one date and then pass an adverse order on a random future date without intimating the taxpayer. This renders the order void.
Section 75(4) Compliance: The right to a personal hearing is substantive. It requires an effective opportunity, which includes knowing when the hearing or decision-making process is actually taking place.

HIGH COURT OF ALLAHABAD

Om Timber Gstin 09advpa8032e2zh

State of U.P.^*

Shekhar B. Saraf and Prashant Kumar, JJ.

WRIT TAX No. – 1191 of 2025

NOVEMBER 10, 2025

Gaurav Singh, Sachin Kumar and Shailesh Sachan for the Petitioner.

ORDER

1. Heard Shri Gaurav Singh, learned counsel appearing on behalf of the petitioner and learned Standing Counsel appearing for the State.

2. This is a writ petition under Article 226 of the Constitution of India wherein the writ petitioner is aggrieved by impugned order dated 17.05.2025 passed under Section 74 of the GST Act by the respondent No.2/Deputy Commissioner, Sector 4, State GST, Sitapur, for the financial year 2021-2022.

3. Upon a perusal of the documents, it appears that the order was passed ex parte and was not passed on the date fixed for hearing and for subsequent date no notice was given to the petitioner.

4. Learned counsel appearing on behalf of the petitioner has relied on the coordinate Bench judgment of this Court in Shubham Steel Traders v. State of U.P (Allahabad) Neutral Citation No. – 2024:AHC:31108-DB. The relevant extract of the said judgement is provided below:-

“8. Thus relying on Coordinate Bench decision of this Court in M/S Videocon D2H Limited and Ors. v. State of U.P. and 3 Ors (2016) 93 UPTC 237, M/S Aroma Chemicals v. Union of India & Ors Neutral Citation No.- 2014:AHC:60699-DB, it has been submitted, such an order may not stand.

…….

10. Rules of natural justice ensure fairness in proceedings. Once the authority had fixed the matter for hearing on 19.04.2025 it was incumbent on that authority either to pass the order or to fix another date and communicate the same to the petitioner. Communication of the other date was necessary as according to the assessing authority the petitioner failed to appear before it on the date fixed on 19.04.2025.

11. By not passing the order on 19.04.2025 and not communicating the next date fixed in the proceedings, the assessing authority forced the ex-parte nature of the order on the petitioner, by its own conduct.”

5. In light of the same, as the facts of the present case are similar to one in Shubham Steel Traders (supra), we see no reason why this Court should take a different view of the matter. Accordingly, the impugned order dated May 17, 2025 is quashed and set aside with a direction upon the authority concerned to grant an opportunity of personal hearing to the petitioner and thereafter, pass a reasoned order in accordance with law.

6. With the aforesaid direction, the writ petition is disposed of.