M/S Maa Gayatri Steel Works vs. State Of U.P. And Another
Original PDF →Facts
The petitioner, M/S Maa Gayatri Steel Works, filed a writ petition challenging a penalty order dated December 10, 2023, passed under Section 73 of the UPGST/CGST Act, 2017, by the respondent authority. The impugned order was issued after the petitioner's GST registration was cancelled. The petitioner sought to quash this penalty order. The High Court heard arguments from both sides. The procedural history indicates that the show cause notice and the subsequent order were issued subsequent to the cancellation of the petitioner's registration.
Held
The Court held that the penalty order dated December 10, 2023, passed under Section 73 of the UPGST/CGST Act, 2017, was invalid and therefore quashed and set aside. The reasoning was based on the fact that both the show cause notice and the impugned order were issued after the cancellation of the petitioner's GST registration. The Court directed the petitioner to file a reply to the show cause notice within four weeks. Upon receiving the reply, the respondent authority is mandated to grant a personal hearing to the petitioner and then pass a reasoned order in accordance with the law. The ratio decidendi is that proceedings under Section 73, including the issuance of a penalty order, cannot validly continue or be initiated after the cancellation of a taxpayer's registration. The operative direction is to quash the existing order and allow the petitioner to participate in a fresh, lawful proceeding.
Key Issues
1. Whether a penalty order passed under Section 73 of the UPGST/CGST Act, 2017, is valid when issued after the cancellation of the assessee's GST registration? The petitioner argued that the penalty order, along with the preceding show cause notice, was vitiated because it was passed after the cancellation of their registration. This, they contended, rendered the entire proceeding invalid. The respondent (State) did not record any specific arguments in the judgment regarding this issue, but their participation implies a defense of the order's validity. The core legal question revolves around the procedural propriety of issuing such an order post-cancellation of registration.
Sections Cited
Section 73
AI-generated summary — verify with the full judgment below
HIGH COURT OF JUDICATURE AT ALLAHABAD WRIT TAX No. - 3861 of 2025 Court No. - 3 HON'BLE SHEKHAR B. SARAF, J. HON'BLE PRAVEEN KUMAR GIRI, J.
Heard learned counsel appearing on behalf of the parties.
This is a writ petition under Article 226 of the Constitution of India filed by petitioner with the following prayers:- "(i) Issue writ, order or direction in the nature of Certiorari quashing the impugned penalty order passed under Section 73 of the UPGST/CGST Act, 2017 dated 10/12/2023 passed by respondent no.1 (Annexure No.1 to the writ petition); (ii) Issue any other suitable writ, order or direction as this Hon'ble Court may deem fit and proper in the circumstances of the case in the facts and circumstances of the case;"
In the present case, the impugned order was passed after cancellation of registration of the petitioner.
In light of the same, we are of the view that the show cause notice and the order were passed after cancellation of registration of the petitioner.
In light of the same, the impugned order dated 10.12.2023 is quashed and set aside.
The petitioner is directed to file its reply to the show cause notice within a period of four weeks. Once the said reply is filed, a personal hearing should be granted to the petitioner and thereafter a reasoned order Versus Counsel for Petitioner(s) : Pooja Talwar Counsel for Respondent(s) : C.S.C. M/S Maa Gayatri Steel Works .....Petitioner(s) State of U.P. and Another .....Respondent(s)
be passed in accordance with law.
With the above directions, the writ petition is disposed of. September 11, 2025 DKS WTAX No. 3861 of 2025 2 (Praveen Kumar Giri,J.) (Shekhar B. Saraf,J.) DEEPAK KUMAR SRIVASTWA High Court of Judicature at Allahabad
Reproduced from the public record of the Allahabad High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.