2024 (3) TMI 116 - HC - GST

Tax Demand Quashed: GST Officer Ordered to Seek Clarifications and Provide Fair Hearing to Petitioner Within Specified Timeframe

The HC set aside an order confirming a tax demand under GST Act, finding the proper officer's evaluation inadequate. The court remitted the matter for ... Violation of principles of natural justice - Validity of confirmation of demand of GST - impugned order does not take into consideration the replies submitted by the petitioner and is a cryptic order which merely records that reply was found not satisfactory and devoid of merits - demand alongwith penalty - HELD THAT:- The impugned order records that petitioner has not furnished the requisite details. Proper Officer is directed to intimate to the petitioner details/documents, as maybe required to be furnished by the petitioner within a period of one week from today. On such intimation being given, petitioner shall furnish the requisite explanation and documents within one week thereof. Thereafter, the Proper Officer shall re-adjudicate the show cause notice within a period of two weeks after giving an opportunity of personal hearing. Petition disposed off. Issues involved:The judgment involves challenging an order confirming a demand under Section 73 of the Central Goods and Services Tax Act, 2017, based on a show cause notice. The issues revolve around the sufficiency of the petitioner's replies to the show cause notice and the proper officer's failure to consider them adequately.Detailed Judgment:Issue 1: Sufficiency of Petitioner's RepliesThe petitioner challenged an order confirming a demand of Rs. 10,03,08,628.00, including penalty, based on a show cause notice. The petitioner contended that detailed replies were submitted on 23.10.2023, 11.12.2023, and 21.12.2023, providing full disclosures under various heads. However, the impugned order dated 30.12.2023 dismissed the replies as unsatisfactory without proper consideration, stating they lacked clarity and merit.Issue 2: Proper Officer's EvaluationThe impugned order failed to adequately assess the petitioner's detailed replies. It merely stated that the explanations were incomplete and lacked supporting documents, leading to the confirmation of the demand. The court noted that the proper officer did not appear to have thoroughly reviewed the submissions, as no specific deficiencies were highlighted, and the petitioner was not given an opportunity to provide further clarifications or documents.Issue 3: Remittal for Re-AdjudicationGiven the improper evaluation of the petitioner's replies, the court set aside the impugned order and remitted the matter to the Proper Officer for re-adjudication. The Proper Officer was directed to request any necessary details or documents from the petitioner within a week and provide an opportunity for the petitioner to explain further within two weeks. The court clarified that it did not delve into the merits of the parties' contentions, reserving all rights and contentions for future consideration.Additional Note:The judgment also mentioned that the challenge to Notification No. 9 of 2023 was left open, and the petition was disposed of accordingly.This summary provides a detailed breakdown of the judgment, focusing on the issues raised by the petitioner regarding the sufficiency of their replies and the proper officer's evaluation, leading to the remittal of the matter for re-adjudication.