2024 (7) TMI 1387 - HC - GST

Levy of GST - Creation of additional demand on unbilled revenue - no reason for rejecting the petitioner s explanation - violation of principles of natural justice - HELD THAT - The impugned order does not indicate any reason for rejecting the petitioner s explanation. It merely states that the reply of the petitioner was received, however same is not acceptable being incomplete/not duly supported by adequate documents / without proper justification and thus unable to clarify the issue - It is apparent that the Adjudicating Authority has not considered the petitioner s reply to the impugned SCN and at any rate not provided any reason for rejecting the same. The impugned order is set aside and matter remanded back to the Adjudicating Authority for consideration afresh - petition allowed by way of remand.

Summary

Issues:
Impugning order under CGST Act and DGST Act regarding 'unbilled revenue' - Rejection of petitioner's explanation without reason - Consideration of petitioner's reply by Adjudicating Authority.

Analysis:
The High Court addressed the petition challenging an order passed under the Central Goods and Services Tax Act, 2017 (CGST Act) and the Delhi Goods and Services Tax Act, 2017 (DGST Act) related to 'unbilled revenue'. The petitioner contested an order dated 29.04.2024 issued by the Adjudicating Authority following a Show Cause Notice from 30.01.2024. The petitioner had paid taxes and interest on the 'unbilled revenue' and provided detailed information in response to the notice. However, the impugned order did not provide any valid reason for rejecting the petitioner's explanation, stating it was incomplete and lacked proper justification.

The Court noted that the Adjudicating Authority failed to consider the petitioner's response to the Show Cause Notice and did not offer any rationale for dismissing it. Consequently, the High Court set aside the impugned order and remanded the matter back to the Adjudicating Authority for a fresh review. The Adjudicating Authority was directed to issue a detailed order after giving the petitioner an opportunity to be heard. Additionally, the Authority was instructed to request any necessary documents or materials to properly adjudicate the matter.

In conclusion, the High Court disposed of the petition by ordering a reconsideration of the case by the Adjudicating Authority, emphasizing the need for a well-reasoned decision and a fair hearing for the petitioner.