GST demand remitted for fresh consideration, with partial cash deposit required to balance disputed tax and interest

A GST demand order passed under Section 74 was challenged on the basis that the adjudication reply was skeletal and unsupported by documents. Although the petitioner later produced Form GSTR-3B to show partial reversal of wrongly availed input tax credit, the record did not clearly establish prior payment through credit or complete reversal of the IGST component. The matter was therefore remitted for fresh consideration, with revenue protected by a condition to deposit 50% of the disputed tax liability and 50% of the interest in cash within the stipulated time.

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Issues: Whether the impugned GST demand order deserved interference and whether the matter should be remitted for fresh consideration subject to deposit of part of the disputed tax and interest.

Analysis: The challenge arose from an order passed under Section 74 of the GST enactment on the basis of a reply that was found to be skeletal and unsupported by documents at the time of adjudication. In the writ proceedings, the petitioner produced Form GSTR-3B to show partial reversal of wrongly availed input tax credit, but the record did not establish payment of the tax earlier discharged through credit or clear reversal of the IGST component. In these circumstances, instead of sustaining the order in full, the matter required fresh consideration, while balancing the revenue interest through a partial deposit condition.

Conclusion: The matter was remitted for fresh orders, with the petitioner required to deposit 50% of the disputed tax liability and 50% of the interest in cash within the stipulated period.

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