Ex Parte GST Order Set Aside Over Defective SCN and Denial of Hearing: Allahabad HC

The High Court quashed an ex parte GST order, finding a violation of natural justice and sent the case back to the tax department to restart proceedings, giving petitioners a proper chance of hearing.

The Allahabad High Court, Lucknow Bench, has heard a writ petition filed by M/S Bimlesh Thru. Proprietor Bimlesh and Another, challenging an ex-parte GST order dated February 22, 2025 and a Show Cause Notice (SCN) dated November 29, 2024, issued for the Financial Year 2020-21.

The petitioner claimed that the impugned notice and proceedings were improper because the response date and the date of hearing were both fixed on the same date, and they were also not given a proper chance of hearing, which is an explicit violation of the principles of natural justice. The petitioner referenced an earlier High Court judgement endorsing the same claim.

When the court analysed the facts of the case, it noted that the tax authorities should have given petitioners a proper chance of hearing before issuing any adverse order. The Court examined the earlier ruling and noted that authorities must provide a meaningful opportunity for a personal hearing before passing any adverse order. If the notice itself is defective or the hearing is not properly granted, the entire proceeding becomes legally invalid. The Court observed that in this case the initial show cause notice was flawed, and the department failed to issue a fresh and proper notice before passing the order.

Even though the writ petition was filed after the normal appeal time limit, the Court stated that it can still intervene in exceptional cases where natural justice is violated. As a result, the Court quashed and set aside the impugned ex parte order dated February 22, 2025, and remanded the case to the tax authorities to freshly start the proceedings by issuing a proper show cause notice and following the law. The writ petition was disposed of with these directions.