Adhoc demand of GST on indirect expenses in GST scrutiny

[VENKAT S]

In GST assessment for FY 17-18, the AO has raised a demand of 18% on a portion of indirect expenses but no reference to the act/rule under which the demand is raised is mentioned.
Is this allowed? if this order to be appealed, then what grounds of appeal are available to the assessee?

The extract from the order is :

" The tax payer has furnished the abstract details of other expenses for Rs ______. The details are verified and accepted except the following expenses which are disallowed.

Repairs to building Rs 435482 Tax payable @ 18% - Rs 78386

Repairs to machinery Rs 351719 Tax payable @ 18% - Rs 63309 "

Any suggestions or guidance is welcomed.

AI Summary

Invalid adjudication orders: demands without cited legal basis breach natural justice and invite appeal or rectification.
Tax was assessed on indirect expenses without citing the statutory or rule basis and without reasoned findings. Such omission raises issues of adjudicatory validity, breach of natural justice and lack of a speaking order, providing grounds for appeal or rectification where the authority failed to address entitlement to input tax credit and relevant classification or notifications.