Order u/s 73 of CGST Act Remitted for Re-adjudication; New Hearing and Order Required.

The HC remitted the matter to the Proper Officer for re-adjudication, finding the impugned order under Section 73 of the CGST Act unsustainable due to failure to consider the petitioner's detailed reply. The Court directed the Proper Officer to specify required documents, allow a personal hearing, and issue a fresh order. The challenge to Notification No. 9 of 2023 remains open, and the petition was disposed of without addressing the merits of the parties' contentions.

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Issues involved: Impugned order under Section 73 of the Central Goods and Services Tax Act, 2017 not considering detailed reply, sustainability of the observation in the order, lack of opportunity to clarify reply, remittance of the matter for re-adjudication, direction to furnish requisite explanation and documents, challenge to Notification No. 9 of 2023.

Summary:

The petitioner challenged an order dated 23.12.2023, which disposed of a Show Cause Notice proposing a demand of Rs. 7,95,34,514.00 under Section 73 of the CGST Act. The petitioner contended that their detailed reply to the Show Cause Notice was not considered in the impugned order, which was deemed cryptic.

The Department had raised concerns regarding excess claim Input Tax Credit, under declaration of ineligible ITC, and ITC claim from cancelled dealers, return defaulters, and tax non-payers. Despite the petitioner furnishing a detailed reply addressing each concern, the impugned order deemed the reply unsatisfactory without proper justification.

The Court found the observation in the impugned order unsustainable as the Proper Officer failed to consider the detailed reply on its merits. Moreover, the petitioner was not given an opportunity to clarify or provide further details, rendering the order invalid. Consequently, the matter was remitted to the Proper Officer for re-adjudication.

The Court directed the Proper Officer to specify the details/documents required from the petitioner, who must then furnish the necessary explanation and documents. Subsequently, the Proper Officer was instructed to re-adjudicate the Show Cause Notice, provide a personal hearing opportunity, and issue a fresh speaking order within the prescribed period under Section 75(3) of the Act.

The Court clarified that it did not delve into the merits of the parties' contentions and reserved all rights and contentions. Additionally, the challenge to Notification No. 9 of 2023 regarding the initial time extension was left open, and the petition was disposed of accordingly.

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