2024 (3) TMI 899 - HC - GST

Demand - interest - lower Input Tax Credit (ITC) - Petitioner was unaware of proceedings commencing from the issuance of an intimation - show cause notice served on the petitioner by post and not merely uploaded on the GST portal - HELD THAT - On perusal of the impugned assessment order, it is evident that the petitioner availed of a lower amount as ITC than the amount reflected in the auto-populated GSTR 2A return. In those circumstances, the conclusion that the petitioner wrongly availed of ITC indicates non application of mind. As regards the interest liability for belated filing of returns, the evidence on record reflects that the petitioner remitted sums of Rs. 3,97,353/- each towards CGST and SGST on 06.03.2024. In these circumstances, the impugned order calls for interference. Therefore, the impugned assessment order is quashed and the matter is remanded to the assessing officer for reconsideration. The petitioner is permitted to file a reply to the show cause notice dated 24.07.2023 within a period of two weeks from the date of receipt of a copy of this order. These writ petitions are disposed of on the above terms. There will be no order as to costs. Consequently, connected miscellaneous petitions are closed.

Summary

Issues involved: Challenge to assessment order and bank attachment notice.

Assessment Order Challenge: The petitioner, engaged in the supply business, claimed Input Tax Credit (ITC) in his return, but the auto-populated return showed a higher amount. Counsel argued that the conclusion of wrongly availed ITC was incorrect. The petitioner had remitted the due amounts, and the order was deemed to lack proper consideration, leading to interference. The assessment order was quashed, and the matter remanded for reconsideration. The petitioner was granted two weeks to respond to the show cause notice, with the assessing officer directed to issue a fresh assessment order within two months.

Bank Attachment Notice Challenge: The Government Advocate contended that the petitioner was duly served the intimation and notice. However, upon review, it was found that the petitioner had actually paid the due amounts, rendering the attachment notice unjustified. Consequently, the attachment notice to recover the tax demand was lifted, and the appropriated amount was subject to the outcome of the reassessment proceedings.

Conclusion: The High Court quashed the assessment order, remanded the matter for reconsideration, allowed the petitioner to respond to the show cause notice, and directed a fresh assessment order to be issued. The bank attachment notice was lifted, and the appropriated amount was tied to the reassessment outcome. The writ petitions were disposed of with no order as to costs.