M/S Kahna Bartan Bhandar Thru.Proprietor Pranshul Tiwari vs. State Of U.P. Thru. Prin. Secy. Deptt. Of State Tax Lko. And 2 Others
Original PDF →Facts
The petitioner, M/s Kahna Bartan Bhandar, through its Proprietor Pranshul Tiwari, filed a writ petition challenging two orders. The first order, dated October 26, 2024, was passed under Section 125 of the CGST Act, imposing two penalties totaling Rs. 50,000. The second order, dated April 5, 2025, dismissed the petitioner's appeal against the penalty order on the grounds of being filed beyond the limitation period. The petitioner's primary contention was that no adequate opportunity of hearing was provided before the penalty order was passed, with notices fixing the same date for filing a reply and for the hearing.
Held
The Court held that both the order dated October 26, 2024, imposing penalties, and the order dated April 5, 2025, dismissing the appeal as time-barred, were liable to be quashed. The reasoning was based on the violation of the principles of natural justice. The Court found that the penalty order was passed without affording the petitioner an adequate opportunity of hearing or permitting them to file a defence. Consequently, the Court quashed both impugned orders. The matter was remanded to the Assessing Authority to pass a fresh order in accordance with the law, ensuring that the petitioner is given an opportunity of hearing. The ratio decidendi is that orders passed without adhering to the principles of natural justice, particularly the right to be heard, are void ab initio. The operative direction was to quash the orders and remand the matter for a fresh adjudication.
Key Issues
1. Whether the order dated October 26, 2024, imposing penalties under Section 125 of the CGST Act is liable to be quashed for violation of the principles of natural justice, specifically the right to a fair hearing? (Question of law) Petitioner's contention: The petitioner argued that the notices issued indicated the same date was fixed for filing a reply and for the hearing, which effectively denied them a proper opportunity to present their defence. They contended that the penalty order was passed without affording a reasonable opportunity of hearing or allowing them to file a defence. Revenue's contention: The judgment records no specific argument from the respondent State.
Sections Cited
Section 125
AI-generated summary — verify with the full judgment below
Neutral Citation No. - 2025:AHC-LKO:31438 Court No. - 6 Case :- WRIT TAX No. - 508 of 2025 Petitioner :- M/S Kahna Bartan Bhandar Thru.Proprietor Pranshul Tiwari Respondent :- State Of U.P. Thru. Prin. Secy. Deptt. Of State Tax Lko. And 2 Others Counsel for Petitioner :- Manas Shukla,Anurag Srivastava,Ashish Kumar Tripathi Counsel for Respondent :- C.S.C. Hon'ble Pankaj Bhatia,J.
Heard learned counsel for the petitioner and learned Standing Counsel for the State.
Present petition has been filed by the petitioner challenging the order dated 26.10.2024 passed under Section 125 of CGST Act whereby two penalties amounting to Rs.50,000/- as well as the order dated 05.04.2025 whereby the appeal was dismissed as being beyond limitation.
Contention of learned counsel for the petitioner is that no opportunity of hearing was granted prior to passing of the said order. The notices indicate that same date was fixed for filing the reply as well as for hearing.
As the order of penalty has been passed without affording any opportunity of hearing or permitting the petitioner to file a defence, both the orders dated 26.10.2024 & 05.04.2025 are quashed.
Matter is remanded to the Assessing Authority to pass a fresh order in accordance with law after giving an opportunity of hearing to the petitioner.
Present petition stands allowed in above terms. Order Date :- 27.5.2025 nishant NISHANT MOHAN High Court of Judicature at Allahabad, Lucknow Bench
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.