Contradictory show cause notice and non-consideration of reply vitiate assessment; fresh proceedings may still be initiated.

A contradictory show cause notice, containing inconsistent GSTR-3B figures across its tables, was treated as unsustainable because the mismatch undermined the foundation of the proceeding. The assessment order was also held vulnerable where it did not consider the taxpayer's reply or record reasons on the objections raised, which fell short of fair procedure. On these grounds, the assessment order was set aside, while fresh proceedings were left open to be initiated through a new show cause notice.

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Issues: (i) Whether the show cause notice was vitiated by internal contradiction in the figures stated for the GSTR-3B return; (ii) whether the assessment order was liable to be interfered with for failure to consider the taxpayer's reply and record reasons.

Issue (i): Whether the show cause notice was vitiated by internal contradiction in the figures stated for the GSTR-3B return.

Analysis: The notice contained two different tables showing inconsistent GSTR-3B amounts. One table reflected CGST and SGST figures of Rs. 3,33,787/-, while the other table, dealing with mismatch between GSTR-3B and auto-populated GSTR-2A, reflected Rs. 5,19,362/- for both CGST and SGST. The latter figure matched the input tax credit availed by the taxpayer, demonstrating inconsistency in the foundation of the proceeding.

Conclusion: The show cause notice was contradictory and therefore unsustainable.

Issue (ii): Whether the assessment order was liable to be interfered with for failure to consider the taxpayer's reply and record reasons.

Analysis: The assessment order did not deal with the reply dated 29.09.2023 and did not explain why the objections raised therein were unacceptable. An assessment order passed without considering the reply and without recording reasons on the objections raised does not satisfy the requirements of fair procedure.

Conclusion: The assessment order was vitiated for non-consideration of the reply and breach of fair procedure.

Final Conclusion: The assessment order was set aside and fresh proceedings were left open to be initiated by issuing a new show cause notice.

Ratio Decidendi: A contradictory show cause notice, coupled with failure to consider the reply and record reasons, vitiates the assessment order.

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