Procedural Fairness Prevails: GST Demand Notice Quashed, Officer Directed to Reconsider Petitioner's Detailed Reply Under Section 73

The HC found that the Proper Officer did not adequately consider the petitioner's detailed reply to a GST demand notice under Section 73. The court set aside the impugned order, remitting the show cause notice for re-adjudication, and directed the Proper Officer to provide a personal hearing and pass a fresh order within the prescribed period, allowing the petitioner 30 days to file a further reply.

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Issues:
The judgment involves the impugning of an order passed under Section 73 of the Central Goods and Services Tax Act, 2017, where a demand was raised against the petitioner.

Detailed Summary:

Issue 1: Consideration of Petitioner's Reply
The petitioner challenged the order dated 30.12.2023, claiming that their detailed reply dated 23.10.2023 was not considered in the said order, which disposed of the Show Cause Notice proposing a significant demand against the petitioner.

Issue 2: Adequacy of Petitioner's Reply
The Show Cause Notice dated 23.09.2023 outlined various reasons for the demand, to which the petitioner responded comprehensively under each head with supporting documents. However, the impugned order stated that the reply was incomplete, not supported by adequate documents, and unable to clarify the issue, without proper consideration of the submitted documents.

Issue 3: Lack of Proper Consideration
The judgment found that the Proper Officer did not adequately consider the petitioner's detailed reply and merely concluded that it was insufficient without a thorough examination. The court held that the Proper Officer failed to apply their mind to the reply submitted by the petitioner, leading to an unsustainable observation in the impugned order.

Issue 4: Opportunity for Clarification
The court noted that if the Proper Officer required further details, they should have specifically requested them from the petitioner. However, there was no evidence that such an opportunity was given to the petitioner to clarify the reply or provide additional documents or details.

Decision:
In light of the above, the impugned order dated 30.12.2023 was set aside, and the show cause notice was remitted to the Proper Officer for re-adjudication. The petitioner was granted 30 days to file a further reply, and the Proper Officer was directed to re-adjudicate the notice, provide a personal hearing, and pass a fresh speaking order within the prescribed period under Section 75(3) of the Act. The court clarified that it did not comment on the merits of the contentions of either party, reserving all rights and contentions. The petition was disposed of accordingly.

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