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of <h1>Legal Challenge Succeeds: CGST Section 73 Notice Invalidated Due to Insufficient Evidence and Procedural Flaws</h1> <h3>M/s. Mondelez India Foods Private Limited Versus The Deputy Commissioner ST</h3> M/s. Mondelez India Foods Private Limited Versus The Deputy Commissioner ST - 2024 (85) G. S. T. L. 86 (Telangana) Issues involved:The challenge to a Show Cause Notice issued under Section 73 of the CGST Act, 2017 for alleged non-payment of tax at 28%.Summary:Issue 1: Challenge to the Show Cause NoticeThe petitioner challenged the Show Cause Notice, claiming it was vague and lacked substantial material for explanation. They argued that the Notice did not specify which transactions were under scrutiny or why tax at 28% was mentioned when their products had a maximum tax rate of 18%. Additionally, they contended that the Notice was beyond the prescribed limitation period.Issue 2: Lack of Information in Show Cause NoticeThe Court noted that the Show Cause Notice lacked necessary information, sources, and materials to support the allegations of tax evasion. It appeared to have been issued mechanically without proper scrutiny or investigation, indicating a lack of reasonable suspicion on the transactions.Issue 3: Initiation of Proceedings under Section 73The Court emphasized that under Section 73 of the Act, proceedings should be initiated based on material or information indicating suspicious transactions or tax evasion. Since the Show Cause Notice lacked such basis, it was deemed unsustainable and set aside.Conclusion:The Court allowed the writ petition, setting aside the Show Cause Notice. The Department retained the right to initiate proceedings in accordance with the law. No costs were awarded, and pending petitions were to be closed.
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