Assistant Commissioner's Section 73 CGST order quashed for lacking proper reasoning and violating natural justice principles

Delhi HC quashed an order passed under Section 73 of the CGST Act, 2017 by the Assistant Commissioner. The court found the order lacked proper reasoning and demonstrated non-application of mind, violating principles of natural justice. The Assistant Commissioner had adopted a template approach, repeatedly using identical phraseology stating replies were "not comprehensible, conceivable, not perspicuous and ambiguous" without proper consideration. Despite previous judicial caution against such templated orders, the officer failed to make necessary amendments. The petition was allowed and the impugned order dated 16 August 2024 was set aside.

---

---

Issues:
Challenging final order under Section 73 of Central Goods and Services Tax Act, 2017 for lack of reasoning and non-application of mind by the Assistant Commissioner.

Analysis:
The judgment concerns a writ petition challenging a final order passed by the Assistant Commissioner under Section 73 of the Central Goods and Services Tax Act, 2017. The petitioner had responded to a Show Cause Notice (SCN) before the final order was issued. The order stated that the taxpayer failed to attend the personal hearing despite multiple opportunities and that the reply filed was deemed incomprehensible and ambiguous. The court observed that the Assistant Commissioner had used a standard template in the order, lacking individualized reasoning, indicating a lack of application of mind. This issue of using a template order language was previously highlighted in a separate case, where the officer failed to make any corrections despite prior caution from the court.

The court found the impugned order to be unreasoned and directed the respondents' counsel to present the judgment to the Principal Commissioner for a review of the adjudication process concerning such cases. Consequently, the court allowed the writ petition, setting aside the order dated 16 August 2024. The respondents were given the liberty to proceed as per the earlier SCN issued, taking into account the petitioner's submitted reply. Importantly, the judgment clarified that all rights and contentions of the parties on merits are preserved for future consideration, leaving the matter open for further legal proceedings.

---