Input tax credit reversal set aside for lack of effective notice and meaningful hearing, with remand for fresh consideration.

Reversal of input tax credit based solely on belated return filing was interfered with where the taxpayer had not received effective communication of the proceedings and was denied a meaningful opportunity to respond. The court noted that the show cause notice and order were only uploaded on the GST portal, while the taxpayer became aware of the matter after bank attachment. As the order had been passed without an effective hearing, it was set aside and the matter remanded for fresh consideration, with liberty to file a reply and obtain personal hearing upon compliance with the directed deposit; the bank attachment was also raised.

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Issues: Whether the order confirming reversal of input tax credit on the basis of belated filing of returns, passed without effective communication of the proceedings and without affording a meaningful opportunity of hearing, was liable to be set aside and the matter remanded.

Analysis: The petitioner challenged the assessment on the ground that the show cause notice and order were uploaded on the GST portal but were not otherwise communicated, and that the petitioner became aware of the matter only after bank attachment. The respondent pointed out that the proceedings were preceded by a show cause notice and reminders offering personal hearing. The order confirmed the proposal solely because the returns were filed belatedly and the petitioner had not replied or appeared. In these circumstances, the denial of an effective opportunity warranted interference, though on terms.

Conclusion: The impugned order was set aside and the matter was remanded for fresh consideration after permitting the petitioner to file a reply and after grant of a reasonable opportunity, including personal hearing, upon compliance with the directed deposit. The bank attachment was raised.

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