Kashi Vishwanath Mfg and another Vs State of U.P. and another (Allahabad High Court)
In the case of Kashi Vishwanath Mfg. and Another Vs State of U.P. and Another, the Allahabad High Court addressed a petition challenging a show cause notice (SCN) issued under Section 74(1) of the Uttar Pradesh Goods and Services Tax Act, 2017, and the subsequent order demanding Rs. 73,87,225.92. The petitioner claimed that only a portion of their detailed reply to a prior notice under Section 74(5) was considered while issuing the SCN in Form GST DRC-01. Furthermore, they cited family disputes as the reason for their inability to respond or attend hearings, resulting in the issuance of a demand order in Form DRC-7. The court noted that the petitioners had also missed the limitation period for filing an appeal under Section 107 of the Act.
Upon reviewing the records, the court observed that significant parts of the petitioner’s plea were ignored during the issuance of the SCN. While the government argued that procedural lapses or personal reasons did not warrant rehearing, the court acknowledged the procedural irregularities. To ensure fair adjudication, the court ordered that if the petitioner deposits 50% of the disputed demand within four weeks, the impugned order dated 24.07.2023 would be set aside, and the authorities would provide a fresh opportunity for a hearing. Failure to meet this condition would result in the dismissal of the petition. This decision underscores the importance of comprehensive consideration of taxpayer replies in GST proceedings.
