Taxpayer Wins Challenge Against GST Demand Order, Secures Right to Supplementary Reply and Fair Hearing Under Section 73

HC set aside a GST demand order u/s 73 due to improper consideration of taxpayer's reply. The court found the Proper Officer failed to adequately review submitted documents and did not provide specific opportunities to address deficiencies. The case was remitted for re-adjudication, with the petitioner granted 30 days to file a supplementary reply and the Officer directed to issue a fresh speaking order after personal hearing.

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Issues involved: Impugned order u/s 73 of the Central Goods and Services Tax Act, 2017; Proper consideration of petitioner's reply; Demand creation based on lack of uploaded documents for cancelled dealer.

Impugned Order Consideration: The petitioner challenged an order disposing of a Show Cause Notice proposing a demand of Rs. 2,87,99,294.00 u/s 73 of the Act. The petitioner contended that the order did not consider their detailed reply submitted earlier.

Show Cause Notice Response: The Department raised grounds under separate headings including excess claim of ITC, non-reconciliation of information, and ITC from cancelled dealers. The petitioner provided a detailed reply with supporting documents addressing each of these grounds.

Lack of Uploaded Documents: The impugned order stated that the taxpayer did not upload supporting documents for a cancelled dealer despite opportunities given. However, the petitioner had indeed uploaded various documents and transaction details related to the cancelled dealer.

Sustainability of Order: The Court found the observation in the impugned order unsustainable as the Proper Officer did not properly consider the detailed reply with supporting documents submitted by the petitioner. The Officer failed to apply his mind to the reply.

Proper Consideration Required: The Court noted that if further details were needed, the Officer should have specifically requested them from the petitioner. However, no such opportunity was given, leading to the setting aside of the impugned order for re-adjudication.

Remittal and Further Action: The Show Cause Notice was remitted to the Proper Officer for re-adjudication. The petitioner was granted 30 days to file a further reply, after which the Officer must re-adjudicate with a personal hearing and issue a fresh speaking order within the prescribed period.

Final Disposition: The Court clarified that it did not comment on the merits of the parties' contentions and reserved all rights and contentions. The petition was disposed of accordingly.

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