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2024 (4) TMI 527 - HC - GSTViolation of principles of natural justice - impugned order does not take into consideration the reply submitted by the Petitioner - cryptic order - under declaration of output tax - reconciliation of GSTR-01 with GSTR-09 - excess claim Input Tax Credit - Scrutiny of ITC availed under ISD - ITC to be reversed on non-business transactions exempt supplies - under declaration of ineligible ITC - ITC claimed from cancelled dealers, return defaulters tax non payers - HELD THAT - The observation in the impugned order dated 26.12.2023 is not sustainable for the reasons that the reply dated 18.12.2023 filed by the Petitioner is a detailed reply. Proper Officer had to at least consider the reply on merits and then form an opinion. He merely held that the reply is incomplete, not duly supported by adequate documents, not clear and unsatisfactory, which ex-facie shows that Proper Officer has not applied his mind to the reply submitted by the petitioner. Further, if the Proper Officer was of the view that any further details were required, the same could have been specifically sought from the Petitioner. However, the record does not reflect that any such opportunity was given to the Petitioner to clarify its reply or furnish further documents/details - the impugned order dated 26.12.2023 cannot be sustained, and the matter is liable to be remitted to the Proper Officer for re-adjudication. Accordingly, the impugned order dated 26.12.2023 is set aside and the matter is remitted to the Proper Officer for re-adjudication. Petition disposed off by way of remand.
Issues involved: Impugned order under u/s 73 of CGST Act, 2017 challenged for not considering detailed reply, sustainability of observations in the order, lack of opportunity for clarification, and remittance for re-adjudication.
Detailed Judgment: 1. Impugned Order Challenge: The petitioner challenged the order dated 26.12.2023, which disposed of the Show Cause Notice proposing a demand against the petitioner under Section 73 of the Central Goods and Services Tax Act, 2017. 2. Lack of Consideration: The petitioner contended that the impugned order did not take into consideration the detailed reply submitted on 18.12.2023, raising concerns about the order being cryptic. 3. Observations in the Impugned Order: The Show Cause Notice dated 24.09.2023 outlined various issues such as declaration of output tax, reconciliation of GSTR-01 with GSTR-09, ITC claims, and more. The petitioner provided a detailed reply addressing each issue. However, the impugned order deemed the reply incomplete, unsupported by adequate documents, unclear, and unsatisfactory without proper consideration. 4. Lack of Opportunity for Clarification: The Court noted that the Proper Officer did not seek further details from the petitioner if deemed necessary. The absence of an opportunity for clarification or submission of additional documents was highlighted as a flaw in the adjudication process. 5. Remittance for Re-adjudication: Given the above shortcomings, the Court held that the impugned order could not be sustained. The matter was remitted to the Proper Officer for re-adjudication. The petitioner was directed to file a reply to the Show Cause Notice within 30 days for a fresh adjudication process with a personal hearing opportunity. 6. Judicial Clarification: The Court clarified that it did not delve into the merits of the parties' contentions and reserved all rights and contentions for future proceedings. 7. Challenge to Notification: The challenge to Notification No. 9 of 2023 regarding the initial extension of time was left open for further consideration. 8. Disposition: The petition was disposed of with the directions for re-adjudication, emphasizing the importance of proper consideration of submissions and granting opportunities for clarification in tax matters.
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