M/S N.K. Traders vs. State Of U.P. And Another
Held
The Court held that in light of the concessions made by the learned Standing Counsel for the revenue, it was not possible for the State to resist the assertions made by the petitioner. The Court found merit in the petitioner's claim regarding procedural errors. Consequently, the ex-parte adjudication order dated 31.03.2026 was set aside. The Court directed that copies of all available RUDs be supplied to the petitioner within two weeks. Any RUD not made available could not be relied upon. The petitioner was granted two weeks thereafter to file their final reply, including any application for cross-examination. If a cross-examination application was filed, a reasoned order was to be passed thereon before adjudication. If cross-examination was allowed, that opportunity would be provided before hearing the matter on merits. The adjudication proceeding was to be heard and decided expeditiously, on or before 31.03.2027.
Facts
The petitioner, M/S N.K. Traders, filed a writ petition challenging an ex-parte order dated 31.03.2026 passed under Section 74(9) of the GST Act and the accompanying summary of order (GST DRC-07) by the Deputy Commissioner, State Tax, Saharanpur, for the tax period June 2019. The petitioner also challenged the show cause notice dated 23.12.2023 issued under Section 74 of the GST Act for the same period. The petitioner's application dated 04.03.2024, seeking copies of relied-upon documents (RUDs) and an opportunity for cross-examination, was allegedly not decided. The adjudication order was passed ex-parte at the end of the limitation period after proceedings were pending for approximately two years. The Standing Counsel for the revenue, after being granted time to obtain instructions, conceded that the State might not be able to resist the petitioner's assertions.
Key Issues
1. Whether the ex-parte adjudication order dated 31.03.2026, passed under Section 74(9) of the GST Act, is liable to be quashed on the ground that the petitioner's application for supply of RUDs and opportunity for cross-examination remained undecided, and the order was passed ex-parte at the end of the limitation period after a significant delay in proceedings? Petitioner's arguments: The petitioner contended that the failure to decide their application for RUDs and cross-examination, coupled with the sudden passing of an ex-parte order at the eleventh hour, vitiated the proceedings. They argued that this prejudiced their right to a fair hearing. Revenue's arguments: The revenue initially disputed the petitioner's claims but, upon further instructions, conceded that they might not be able to resist the assertions made by the petitioner regarding the procedural lapses.
Sections Cited
Section 74, Section 74(9)
AI-generated summary — verify with the full judgment below
HIGH COURT OF JUDICATURE AT ALLAHABAD WRIT TAX No. - 3992 of 2026 Court No. - 39 HON'BLE SAUMITRA DAYAL SINGH, J. HON'BLE SWARUPAMA CHATURVEDI, J.
Heard Sri Nitin Kesarwani, learned counsel for the petitioner and Sri Ankur Agarwal, learned Standing Counsel for the revenue.
Present petition has been filed for the following relief: "i) Issue a writ, order or direction in the nature of certiorari, quashing the impugned ex-parte order dated 31.03.2026 passed Under Section 74(9) of the GST Act alongwith summary of the order issued in the form GST DRC-07 dated 31.03.2026 by the Deputy Commissioner, State Tax, Sector-3, (earlier Sector -5), Saharanpur, U.P (Respondent No. 2) for the Tax period June 2019 to June 2019 (Financial Year 2019-20). (Annexure no. 3 to this writ petition). ii) Issue a writ, order or direction in the nature of certiorari, quashing the impugned show cause notice dated 23.12.2023 issued Under Section 74 of the GST Act in DRC-01 by the Deputy Commissioner, State Tax, Sector-3, (earlier Sector -5), Saharanpur, U.P (Respondent No. 2) for the Tax period June 2019 to June 2019 (Financial Year 2019-20). (Annexure no. 1 to this writ petition)."
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