Excess Input Tax Credit remanded for fresh adjudication subject to a part deposit; bank attachment vacated on compliance.

Challenge to a GST demand for alleged excess input tax credit based on GSTR-2A/GSTR-3B mismatch raised legal issues of supervisory intervention where the statutory appeal period had lapsed. The court relied on the taxpayer's admission and proposed payment in ordering remand for fresh adjudication and imposed a conditional deposit requirement as interim relief; upon compliance the attachment on bank accounts will be vacated and the revenue must decide the claim afresh expeditiously. Outcome: impugned order quashed and matter remitted subject to the deposit condition.

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Issues: Whether the impugned order dated 29.08.2024 under Section 73 confirming demand for excess input tax credit can be quashed and remitted for fresh adjudication subject to deposit by the petitioner.

Analysis: The petitioner challenged the confirmation of tax demand under Section 73 of the GST enactments for alleged excess ITC arising from mismatch between GSTR-2A and GSTR-3B for 2019-2020. The appeal limitation under Section 107 has lapsed and the petitioner filed a writ petition. The petitioner admitted the discrepancy in its reply and offered a computation and payment proposal in Form DRC-06. The Court observed authorities under similar circumstances quashing orders and remitting matters for fresh consideration on terms requiring deposit of a portion of disputed tax depending on delay. Having regard to the petitioner's admission in the reply, the proposed payment computation, and the expired statutory appeal period, the Court exercised its supervisory jurisdiction to set terms for remand and interim relief, including suspension/lifting of bank attachment upon compliance with the deposit condition.

Conclusion: The impugned order is quashed and the matter is remitted to the respondent for fresh adjudication on merits subject to the petitioner depositing fifty percent of the disputed tax within thirty days; upon such compliance the respondent shall pass a fresh order expeditiously and the bank attachment shall be vacated. This conclusion is partly in favour of the assessee.

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