HC Sets Aside GST Demand Order Exceeding Amount in SCN

Case Details: Sai Computers vs. State of U.P. - [2025] 179 taxmann.com 233 (Allahabad)

Judiciary and Counsel Details

• Shekhar B. Saraf & Praveen Kumar Giri, JJ.
• Ajay Kumar Kashyap, Ravindra Kumar Rastogi & Vishakha Dubey for the Petitioner.

Facts of the Case

The petitioner, a GST-registered taxpayer, received a show-cause notice under the CGST Act and Uttar Pradesh GST Act for certain periods, proposing a specific demand as tax, interest, and penalty. The petitioner filed a response to the notice. Subsequently, the GST department issued an order confirming a demand substantially exceeding the amount specified in the show-cause notice. The order was challenged, contending that the demand in excess of the notice violated the provisions of Section 75(7) and deprived it of the opportunity of hearing in accordance with natural justice. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that an order confirming tax, interest, or penalty cannot exceed the amount specified in the show-cause notice, and no demand can be raised on grounds other than those specified therein. Since the impugned order confirmed a demand beyond the scope of the notice, it was ex facie contrary to Section 75(7). Consequently, the court set aside the order and remanded the matter to the jurisdictional officer to pass a fresh order after providing the petitioner an opportunity of hearing.