M/S Hafzi Brick Field vs. State Of U.P. And Another
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The petitioner, M/s Hafzi Brick Field, filed a writ petition challenging a demand order dated 09.11.2024 issued by the Deputy Commissioner, State Tax, Sector-12, Saharanpur, under Section 74 of the Goods and Services Tax Act, 2017. The petitioner argued that the impugned order failed to comply with the requirements of Section 75(6) of the Act, as it did not set out the relevant facts and the basis of the decision, instead incorporating the show cause notice by reference. The respondent, State of U.P. and another, attempted to support the order but did not dispute that the issue was covered by a previous judgment of the Court.
Held
The Court held that the demand order dated 09.11.2024, issued by the Deputy Commissioner, State Tax, Sector-12, Saharanpur, was unsustainable. Similar to the precedent case of M/s Hari Shanker Transport, the order failed to comply with Section 75(6) of the Goods and Services Tax Act, 2017, as it did not contain any reasoning and merely incorporated the show cause notice by reference. The Court found that the statutory requirements for passing an order by setting out relevant facts and the basis for the decision were missing. Consequently, the petition was allowed, the impugned order was quashed and set aside, and the matter was remanded back to the Deputy Commissioner. The Deputy Commissioner was directed to provide the petitioner an opportunity to file a response to the show cause notice within four weeks and thereafter pass a fresh order in accordance with law after providing an opportunity of hearing. The principle established is that a final order under the GST Act must be self-contained and provide the basis for its decision, not merely refer to previous notices.
Key Issues
1. Whether the demand order dated 09.11.2024, issued under Section 74 of the Goods and Services Tax Act, 2017, is liable to be quashed for non-compliance with Section 75(6) of the Act, which mandates that the proper officer shall set out the relevant facts and the basis of his decision in the order. Petitioner's contention: The impugned order is unsustainable as it lacks any reasoning and merely incorporates the show cause notice by reference, failing to meet the statutory requirement of Section 75(6). The petitioner relies on the judgment in M/s Hari Shanker Transport Vs. Commissioner of Commercial Tax U.P. : Writ Tax No.606 of 2025, decided on 11.03.2025, which held similar orders to be invalid. Respondent's contention: The respondent attempted to support the order but did not dispute that the issue was covered by the precedent case of M/s Hari Shanker Transport.
Sections Cited
Section 74, Section 75(6), Section 73, Section 61
AI-generated summary — verify with the full judgment below
Neutral Citation No. - 2025:AHC:91309-DB Chief Justice's Court Case :- WRIT TAX No. - 2594 of 2025 Petitioner :- M/s Hafzi Brick Field Respondent :- State of U.P. and another Counsel for Petitioner :- Akhil Agnihotri Counsel for Respondent :- Nimai Dass, A.C.S.C. Hon'ble Arun Bhansali,Chief Justice Hon'ble Kshitij Shailendra,J.
This writ petition is directed against the demand order dated 09.11.2024 issued by the Deputy Commissioner, State Tax, Sector- 12, Saharanpur under Section 74 of the Goods and Services Tax Act, 2017. 2. Learned counsel with reference to judgment in M/s Hari U.P. : Writ Tax No.606 of 2025, decided on 11.03.2025, made submissions that the order impugned does not fulfill the requirement of Section 75(6) of the Act and, therefore, the order impugned deserves to be quashed and set aside and the matter be remanded back.
Learned counsel appearing for the respondents attempted to support the order impugned, however, does not dispute that the issue as raised is covered by the judgment in the case of M/s Hari Shanker Transport (supra).
In the case of M/s Hari Shanker Transport (supra), this Court, after hearing the parties, came to the following conclusion:- "
A bare look at the order impugned dated 27.04.2024 passed under Section 73(9) of the Act reveals that the same only makes reference to issuance of two notices, the fact that they have not been responded to, and a demand has been raised.
The manner of passing of order dated 27.04.2024 falls foul of the requirements of Section 75(6) of the Act, which requires that 'the proper officer, in his order shall set out the relevant facts and the basis of his decision', the statutory requirements for passing an order by setting out relevant facts and basis for the decision are totally missing from the order dated 27.04.2024. Even if no response was filed to the notices issued under Sections 61 and 73 of the Act, it was incumbent on respondent no.2 to pass an order in compliance of the provisions of Section 75(6) of the Act, as a final order should be self contained and merely making reference to the previous notices while passing the said order does not suffice for making it a self contained order.
Consequently, the petition is allowed. The order dated 27.04.2024 (Annexure-6 to the writ petition) is quashed and set aside. The matter is remanded back to respondent no.2/Deputy Commissioner, State Tax, Sector-3, Sonbhadra to provide an opportunity of filing response to the show cause notice issued under Section 73 of the Act to the petitioner, which response shall be filed within a period of four weeks from today and thereafter, after providing opportunity of hearing, a fresh order in accordance with law be passed."
Admittedly, in the present case, the order dated 09.11.2024 also does not contain any reason and only the indication made in the show cause notice has been incorporated by reference and, therefore, the said order cannot be sustained.
Consequently, the writ petition is allowed.
The order dated 09.11.2024 (Annexures - 1 to the writ petition) is quashed and set aside. The matter is remanded back to Deputy Commissioner, State Tax, Sector-12, Saharanpur, who shall provide an opportunity of filing response to the show cause notice issued under Section 74 of the Act to the petitioner, which response shall be filed within a period of four weeks from today and, thereafter, after providing opportunity of hearing, a fresh order in accordance with law be passed. Order Date :- 28.5.2025 nd (Kshitij Shailendra, J) (Arun Bhansali, CJ) NISITH DEY 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.