2026 (3) TMI 1507

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....cause notices were issued on the petitioner on 28.03.2025 alleging that there is turnover difference between GSTR-3B and the profit and loss account as submitted by the petitioner in Form 26AS to the income tax authorities. The show cause notice itself says that the defect has been communicated to the petitioner to pay the difference in GST at the rate of 12% for the year 2018- 2019 and 2020-2021. The show cause notice further states that the taxpayer paid the pending tax due of CGST Rs. 16,22,731/- and SGST of Rs. 16,22,731/- vide DRC-03 dated 27.03.2025. Therefore, the notices were issued, for the belated payment as also for the payment of penalty under Section 74 of the TNGST Act. 3.This apart, show cause notices were also issued with....

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.... the authorities cannot invoke Section 74 of the Act. 6.The learned counsel would reiterate that either in the show cause notice or in the assessment order, there is no allegation of fraud or willful misrepresentation or misstatement is made. Therefore, the authorities ought not to have passed an order under section 74 of the Act. 7.Per Contra, the learned Additional Government Pleader would submit that in this case, a set of transactions was reported to the respondents under GSTR-3B, however, only on inspection and verification of the profit and loss accounts submitted by the petitioner in Form 26AS to the income tax authorities, the respondents were able to find out the differences and there are suppression of certain transactions o....

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....ence can be made to paragraph 9 of the judgment in Neeyamo Enterprises(cited supra). "9. In the case on hand, the show cause notice does not allege that the assessee was guilty of fraud, wilful misstatement or suppression of facts. When that is not even the case of the proper officer, Section 74 could not have been invoked. Presence of one or all the three elements is a sine qua non for taking action under Section 74 of the Act. It is not necessary that the statutory language must be reproduced. If one can cull out their presence by a overall reading of the show cause notice and the impugned order, the requirement of the section can still be said to be satisfied. In other words, both the show cause notice as well as the impugned or....