Case Law Details
Chauchan Brick Works Vs State of U.P. And 3 Others (Allahabad High Court)
The court’s intolerance for “non-speaking orders” that ignore jurisdictional challenges. By setting aside the adjudication order, the High Court has reinforced that tax authorities cannot simply dismiss legal objections-especially those regarding limitation and jurisdiction—with “subjective conclusions”
The Allahabad High Court considered a writ petition challenging an adjudication order dated 19.03.2026 passed under Section 74 of the U.P.G.S.T. Act, 2017. The petitioner contended that the proceedings were without jurisdiction and barred by limitation. It was argued that the mandatory conditions for invoking Section 74 were not satisfied and that the show cause notice issued on 20.09.2025 for the tax period 2019–20 was beyond the prescribed time limit. The petitioner also raised objections on merits and asserted that, being under the compounding scheme, proceedings under Section 74 could not be initiated.
The Court observed that these objections relating to jurisdiction and limitation had been raised before the adjudicating authority. However, upon examining the impugned order, it found that no cogent reasons had been provided for rejecting those objections. Although the objections were reproduced in detail, the authority recorded only a subjective conclusion without proper reasoning.
Considering that this defect was apparent on the face of the record, the Court held that no useful purpose would be served by keeping the writ petition pending or seeking a counter affidavit. Accordingly, the impugned order was set aside. The matter was remitted to the adjudicating authority to reconsider the objections on their merits and to pass a fresh, reasoned, and speaking order after granting an opportunity of hearing.
The petitioner was directed to appear on 07.05.2026, and the authority was instructed to pass a fresh order by 30.05.2026. The petition was disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Sri Ravindra Kumar Rastogi, learned counsel for the petitioner and Sri Arvind Kumar Mishra, learned Standing Counsel for the State.
2. At present, it does appear that Adjudication Order dated 19.03.2026 passed under Section 74 of the U.P.G.S.T. Act, 2017 has not considered the objection raised as to the jurisdiction, both on account of non-satisfaction of the mandatory conditions to initiate proceedings under Section 74 of the U.P.G.S.T. Act, 2017 and also on account of proceedings having become time barred. In that, it may be noted that tax period in dispute is 2019-20. The show cause notice under Section 74 of the Act was first issued on 20.09.2025. That is described to be beyond limitation.
3. Objections have been raised affecting the issues of jurisdiction as also the merit of the matter. Other objections have also been raised that no jurisdiction could ever arise under Section 74 of the Act as the petitioner falls under the compounding scheme.
4. On bare perusal of the impugned order, it does appear that the objections as to the jurisdiction and limitation were raised and pressed by the petitioner. No cogent reason has been offered in the impugned order to reject the same. After extracting (in extenso), the objections raised by the petitioner, a wholly subjective conclusion has been recorded that the objections raised do not merit acceptance.
5. In view of such facts being apparent from the face of the record, no useful purpose may be served in keeping the present writ petition pending or calling for counter affidavit at this stage. Without allowing the revenue time to cure any inherent defect that may have crept in the proceedings, owing to issuance of show cause notice under Section 74 of the Act for the period 2019-20, on 20.09.2025 but allowing the adjudicating authority another opportunity to consider the objections raised by the petitioner, on the strength of their own merit, at present, the impugned order dated 19.03.2026 is set aside. The matter is remitted to the adjudicating authority to pass a fresh reasoned order after giving the petitioner a reasonable opportunity of being heard.
6. Accordingly, the petitioner may appear before the adjudicating authority on 07.05.2026. He may be heard on the objections already on record. Thereafter, a reasoned and speaking order may be passed on or before 30.05.2026.
7. The present petition is disposed of.
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