Suspension of quasi-judicial tax officers needs strong prima facie misconduct; compliance with refund procedure can defeat it.

Suspension of a tax officer exercising quasi-judicial refund-processing functions cannot be sustained without strong prima facie material of grave misconduct or moral turpitude. Where the officer followed the prescribed GST refund verification procedure under the statutory and circular-based framework, later discovery of fraud in the underlying refund claims does not by itself justify suspension, especially if physical verification of e-way bills was not required by the governing circular. The stated principle is that suspension is an exceptional measure and must rest on serious misconduct or a public-interest basis for non-continuance in office, while departmental proceedings may still continue and an alternative posting may be used to reduce prejudice during inquiry.

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Issues: Whether the suspension of a quasi-judicial tax for sanctioning refund claims was justified in the absence of strong prima facie material showing moral turpitude or grave misconduct.

Analysis: The writ petition arose from a suspension order passed against a tax officer who had processed refund claims under the GST regime. The governing framework recognised refund processing under Section 54 of the Central Goods and Services Tax Act, 2017 and the prescribed circular-driven verification procedure, including online scrutiny of documents and shipping-related details through the designated portal. The officer's case was that he had followed the prescribed refund procedure and that the alleged fraud by the exporter came to light later. The respondents relied on alleged failure to verify e-way bills and on findings of undue haste and non-application of mind. The Court applied the settled principle that suspension is an exceptional measure, especially where the employee performs a quasi-judicial function, and can be sustained only when there is a strong prima facie case, serious misconduct, or a public interest basis justifying non-continuance in office. On the materials placed, the Court found that the prescribed refund verification steps had been followed, that physical verification of e-way bills was not mandated by the governing circular, and that the record did not disclose strong prima facie material connecting the officer with moral turpitude or grave misconduct.

Conclusion: The suspension was held unjustified and liable to be quashed.

Final Conclusion: The officer was entitled to relief against suspension, though the departmental proceedings could continue and an alternative posting could be made to avoid further prejudice to the ongoing inquiry.

Ratio Decidendi: Suspension of an exercising quasi-judicial powers cannot be sustained without strong prima facie material of grave misconduct or moral turpitude, and compliance with the prescribed statutory and circular-based procedure negates such suspension merely because the underlying refund later turns out to be fraudulent.

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