HC Quashes Show Cause Notice Proceedings, Directs Fresh Adjudication with Proper Hearing Under CGST Section 73

HC set aside the order disposing of Show Cause Notice u/s 73 of CGST Act, 2017. The court remitted the matter to the Proper Officer, directing the petitioner to file a reply within four weeks. The Officer must re-adjudicate the matter, provide a personal hearing, and pass a fresh order within prescribed statutory timelines, while reserving all substantive rights and contentions.

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Issues involved: Impugning order disposing of Show Cause Notice u/s 73 of CGST Act, 2017 and creating demand against petitioner.

Judgment Details:

1. The petitioner challenged the order disposing of the Show Cause Notice proposing a demand against them u/s 73 of the Central Goods and Services Tax Act, 2017. The order was set aside, and the matter was remitted to the Proper Officer for re-adjudication.

2. The petitioner, who was already facing proceedings u/s 61 of the Act, contended that they did not file a reply to the Show Cause Notice u/s 73 as they believed the proceedings had been closed after the proceedings u/s 61 concluded favorably.

3. The Show Cause Notice raised various grounds, including excess claim of Input Tax Credit, scrutiny of ITC availed, ITC reversals, and other related issues.

4. The Court acknowledged the petitioner's belief that the proceedings u/s 73 were closed due to the conclusion of proceedings u/s 61. As the impugned order was based on the petitioner not filing a reply, the Court granted the petitioner one opportunity to respond to the Show Cause Notice.

5. The petitioner was directed to file a further reply within four weeks, and the Proper Officer was instructed to re-adjudicate the matter, giving the petitioner a chance for a personal hearing and to pass a fresh order within the prescribed period u/s 75(3) of the Act.

6. 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.

7. The petition was disposed of with the above terms, providing the petitioner with an opportunity to respond to the Show Cause Notice and have the matter re-adjudicated by the Proper Officer.

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