Wonder Enterprises Vs State of U.P. (Allahabad High Court)
Summary: The Allahabad High Court considered whether an adjudicating authority could, while exercising power under Section 161 of the U.P. GST Act, rectify an ex-parte adjudication order by subsequently considering replies that had not been considered in the original order, instead of recalling the original order and granting the assessee a fresh opportunity of hearing.
The petitioner was first issued a show cause notice under Section 74 of the U.P. GST Act, 2017 on 17.06.2021. The petitioner submitted replies on 13.07.2021 and 18.07.2021. Despite those replies, the adjudicating officer passed an ex-parte order on 30.01.2025. On a plain reading of that order, the High Court found that the two replies did not appear to have been considered.
Thereafter, on 05.02.2025, the adjudicating authority passed another order under Section 161 of the Act without issuing notice to the petitioner. In that order, the authority itself acknowledged that the earlier order contained an error because the replies dated 13.07.2021 and 18.07.2021 had not been considered. Instead of recalling the earlier order and fixing another hearing, however, the authority proceeded to consider those replies ex-parte and passed a second order.
The High Court held that the controversy principally concerned the scope of the rectification power under Section 161. The provision permits an authority to rectify an error apparent on the face of the record, including suo motu rectification, subject to the statutory limitations. The Court noted that the six-month period did not present an issue because the second order was passed within one week. The authority had also itself treated the non-consideration of the two replies as an error falling within Section 161.
