Tax Demand Order Quashed: Officer Directed to Reconsider Evidence, Provide Fair Hearing, and Issue Reasoned Decision Within 30 Days

HC found the tax demand order against the Petitioner unsustainable due to improper consideration of submitted documents and reply. The court set aside the order, remitting the matter for re-adjudication, directing the Proper Officer to provide a personal hearing and issue a fresh speaking order within 30 days, while reserving all substantive rights of the parties.

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Issues:
The judgment deals with the impugned order dated 28.12.2023, concerning a demand raised against the Petitioner under Section 73 of the Central Goods and Services Tax Act, 2017.

Detailed Summary:

Issue 1: Consideration of Petitioner's Reply
The Petitioner challenges the order dated 28.12.2023, alleging that it did not consider the detailed reply submitted by the Petitioner on 24.10.2023. The Petitioner argues that the order was cryptic and did not take into account the disclosures made in the reply.

Issue 2: Adequacy of Supporting Documents
The impugned order raised concerns about the completeness of the supporting documents provided by the Petitioner in response to the Show Cause Notice dated 24.09.2023. The Proper Officer opined that the reply was not supported with complete and relevant documents, leading to the demand being raised against the Petitioner.

Court's Analysis and Decision
The Court found the observation in the impugned order regarding the lack of complete documents unsustainable. It noted that the Petitioner had submitted a detailed reply with supporting documents, and the Proper Officer failed to consider the reply on its merits. The Court highlighted that the Proper Officer did not seek further details or documents from the Petitioner before passing the order.

Remittance for Re-adjudication
Consequently, the Court set aside the impugned order dated 28.12.2023 and remitted the matter to the Proper Officer for re-adjudication. The Court directed the Petitioner to file a reply to the Show Cause Notice within 30 days for re-evaluation by the Proper Officer, who must provide an opportunity for a personal hearing and pass a fresh speaking order in accordance with the law.

Final Remarks
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 extension of time was left open. The petition was disposed of accordingly.

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