2024 (12) TMI 921 - HC - GST

Tax Assessment Challenge Overturned: Petitioner Granted Two-Week Window to Submit Reconciliation Documents and Raise Objections

HC allowed petitioner's challenge to tax assessment for 2017-18. The court set aside the original order and directed petitioner to submit reconciliation ... Challenge to impugned order passed by the respondent relating to the assessment year 2017-18 - excess availment of Input Tax Credit vis-a-vis Input Tax Credit reported in annual return in GSTR-9 - HELD THAT:- To a pointed question as to why was the impugned order passed without intimating the petitioner to produce documents for all the transactions, despite a specific request having been made by the petitioner vide letter dated 28.08.2023, the learned counsel for the respondent would submit that petitioner may submit their objections along with supporting documents and orders would be passed afresh. The impugned order is set aside. The petitioner shall treat the impugned order of assessment as a Show Cause Notice and shall submit its objections within a period of two (2) weeks from the date of receipt of a copy of this order along with relevant reconciliation statement and supporting documents/material - Petition disposed off. Issues:Challenge to impugned order relating to assessment year 2017-18 based on excess availment of Input Tax Credit in GSTR-9C.Analysis:The petitioner, engaged in the manufacture of auto components and registered under the Goods and Services Act, challenged the impugned order passed by the respondent regarding the assessment year 2017-18. The issue arose when there was an excess availment of Input Tax Credit compared to the Input Tax Credit reported in the annual return in GSTR-9. A notice was issued to the petitioner, followed by a proposal to levy tax on the non-reconciled amount. The petitioner responded by indicating that filling up S.No.14 in GSTR-9C was not mandatory, leading to certain columns being left unfilled. Subsequently, the petitioner reconciled the ITC as per Entry 14 of Form GSTR-9C and submitted the necessary documents.The petitioner contended that the impugned order proceeded on the basis that the petitioner had not filed the ITC register or purchase invoices to substantiate their claim. It was argued that the respondent authority should have notified the petitioner if the documents filed were inadequate. The petitioner claimed that they were willing to provide the necessary documents if intimated. The petitioner highlighted that they had already submitted sample invoices due to the voluminous nature of the total invoices and were prepared to furnish specific invoices upon request. The petitioner argued that the impugned order violated principles of natural justice as they were not informed of the need to provide documents for all transactions.The Court set aside the impugned order and directed the petitioner to treat it as a Show Cause Notice. The petitioner was instructed to submit objections within two weeks along with a reconciliation statement and supporting documents. The respondent was to consider any objections filed and pass orders accordingly after providing a reasonable opportunity for a hearing. Failure to file objections within the stipulated period would result in the restoration of the impugned order. The writ petition was disposed of with no order as to costs, and connected miscellaneous petitions were closed.