Reasoned findings on fraud and suppression are essential for Section 74 GST assessments; cryptic ex parte orders cannot stand.

An ex parte GST assessment order under Section 74 was unsustainable where the proper officer recorded only issuance of notice and non-filing of reply, but made no reasoned findings on fraud, wilful misstatement, or suppression of facts to evade tax. The Court treated the order as cryptic because the statutory prerequisites for invoking Section 74 were not examined on the record. The assessment was set aside and the matter was remitted for fresh adjudication, with the taxpayer to be given time to respond and a personal hearing.

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Issues: Whether an assessment order under Section 74 of the Central Goods and Services Tax Act, 2017, passed ex parte without recording reasons or findings on fraud, wilful misstatement, or suppression of facts, could be sustained, and whether the matter required re-adjudication.

Analysis: The impugned order merely recorded that the notice had been issued and that no reply had been uploaded before the order was passed. It did not disclose any reasoning or findings by the proper officer on the statutory prerequisites of fraud, wilful misstatement, or suppression of facts to evade tax. In the absence of such reasons, the order was treated as cryptic and unsustainable. The petitioner was also granted time to file a response and an opportunity of personal hearing on remand.

Conclusion: The assessment order was set aside and the matter was remitted to the proper officer for fresh adjudication in accordance with law after affording an opportunity of hearing to the petitioner.

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