Unlawful GST recovery pressure letter quashed where no show cause, demand, or recovery notice was issued.

A departmental letter directing voluntary payment of an alleged GST liability, without any show cause notice, demand notice or recovery notice, was held unsustainable. The HC treated the communication as a pressure mechanism rather than a lawful adjudicatory or recovery step, because no statutory foundation for the asserted liability was shown and only a reference to interest under section 50 of the CGST Act was made. The letter was quashed and set aside, and relief was granted to the taxpayer.

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Issues: Whether a departmental letter advising voluntary payment of alleged GST liability without issuance of any show cause notice, demand notice or recovery notice could be sustained.

Analysis: The letter was found to be a direction for continued voluntary payment towards an asserted tax liability, coupled with reference to interest under section 50 of the Central Goods and Services Tax Act, 2017, but without any statutory notice or other lawful foundation pointed out by the Department. The Court treated the communication as an impermissible pressure mechanism rather than a lawful adjudicatory or recovery step.

Conclusion: The impugned letter was quashed and set aside, and the writ petition was allowed in favour of the petitioner.

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