TaxTMI 
TaxTMI 
2026 (1) TMI 1273
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....ber 11, 2024 under Section 73(1) of the said Act of 2017 had been issued to the petitioner no. 1 (hereafter "the petitioner") calling upon the petitioner to show cause as to why should the petitioner not be held liable for payment of tax, inter alia, on the ground that Income Tax Credit (ITC) that was found reversible in proportion to exempt supply to the tune of Rs. 23,12,870/- towards IGST and Rs. 3,79,210.65/- each under CGST and SGST. 3. The petitioner furnished its reply to the notice to show cause thereby asserting that it was not liable to reverse any ITC. 4. On February 24, 2025, the Proper Officer passed the impugned adjudication order thereby observing that the invoices of the product dealt in by the petitioners did not esta....
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.... impugned has been passed in total violation of the provisions of section 75(7) of the said Act of 2017 inasmuch as the Proper Officer has held against the petitioners on a ground that was never put across the petitioners and that the petitioners never had any opportunity to meet. 7. She has taken the Court through the notice to show cause to demonstrate that the only ground (relevant for the purpose of present writ petition) taken in the notice to show cause was that "ITC that was found reversible in proportion to exempt supply, if any". It is submitted that the question as to whether the goods dealt in by the petitioners fell under the exempted category or not was neither posed to the petitioners nor was the same a point of considerati....
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.... each under CGST and SGST Act. RP's reply: RP claims that his exempted turnover is Rs. 1,36,40,490.00 and not Rs.2,56,57,860.00 Rs. 1,19,97,370.00 was wrongly declared under 0% taxable supply in GSTR-1. He also claims he has purchased exempted goods and sells the same goods, so no question of reversal of ITC arises. Observation: The RP failed to establish with valid documents that why the provisions section 17(2) of the CGST/SGST Act will not be applicable for the entire credit availed. The RP is required to furnish the inward and outward statement of exempted supply supported by relevant invoices, transport documents, payment details etc. The RP is also required to furnish the documentary evidence of wrong declaration....
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....han the one indicated in the notice to show cause, the same falls foul of the provisions of Section 75(7) of the said Act of 2017. Accordingly, the order impugned dated February 24, 2025 stands set aside. 15. This order shall, however, not prevent the respondents from initiating fresh proceedings, in accordance with law. It is noticed that earlier too, the writ petitioners had to knock the doors of this Court by filing WPA 18295 of 2024 raising an almost similar issue. WPA 18295 of 2025 was disposed of by an order dated April 10, 2025 thereby setting aside the order impugned and leaving the respondents free to initiate fresh proceeding on the basis of their assertion as available in the order impugned before this Court, in accordance wit....