Failure to consider reply to show cause notice vitiates GST assessment and requires fresh adjudication with hearing

An assessment order under Section 73 of the CGST Act was found unsustainable because the authority failed to consider the taxpayer's reply to the show cause notice and proceeded as if no reply had been filed. That omission indicated lack of due application of mind and denial of proper consideration before adjudication. The matter was therefore required to be reconsidered after giving the taxpayer a clear opportunity of hearing, and the order was set aside with remand for fresh adjudication on 14 days' notice and personal hearing.

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Issues: Whether the assessment order passed under Section 73 of the Central Goods and Services Tax Act, 2017 was liable to be set aside for failure to consider the reply to the show cause notice, and whether the matter required remand for fresh consideration.

Analysis: The petitioner had filed a reply to the show cause notice, but the impugned order proceeded as though no reply had been submitted. Such omission showed that the reply was not considered before passing the assessment order. The Authority was therefore found to have acted without due application of mind. Since the reply had not been taken into account, the order could not be sustained and the dispute had to be reconsidered after a proper opportunity of hearing.

Conclusion: The assessment order was set aside and the matter was remanded for fresh adjudication after issuing a clear 14-days notice and granting personal hearing.

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