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2024 (9) TMI 538 - HC - GSTViolation of principles of natural justice - summary notice issued was vague and merely on the risk of availment of excess ITC by the Petitioner on account of mismatch in GSTR-3B/9 and GTR-2A - order u/s 73 of the Central Goods and Services Tax Act, 2017 - HELD THAT - The observation in the impugned order dated 30.04.2024 is not sustainable for the reasons that the reply dated 18.04.2024 and 24.04.2024 filed by the Petitioner are detailed replies with supporting documents. Proper Officer had to at least consider the reply on merits and then form an opinion. He merely held that the reply is not satisfactory and relevant/supporting documents not furnished which ex-facie shows that Proper Officer has not applied his mind to the reply submitted by the petitioner. As per the petitioner reference of an audit observation in the impugned order is also erroneous for the reason that there was no audit conducted of the petitioner in terms of Section 65 of Central Goods Services Tax Act, 2017 and the reference of an audit observations appears to be cryptic on account of an audit which was conducted on the GST Department itself. The impugned order dated 30.04.2024 cannot be sustained and is set aside. The Show Cause Notice is remitted to the Proper Officer for re-adjudication - Petition disposed off by way of remand.
Issues:
Impugned order under Section 73 of the Central Goods and Services Tax Act, 2017; Vagueness of summary notice; Consideration of petitioner's reply in the impugned order; Sustainability of the impugned order; Error in audit observation reference in the impugned order. Analysis: The petitioner challenged an order dated 30.04.2024 that disposed of a Show Cause Notice proposing a demand of Rs. 10,04,94,110.00 against the petitioner under Section 73 of the Central Goods and Services Tax Act, 2017. The petitioner contended that the summary notice issued was vague and based on the risk of excess Input Tax Credit (ITC) availed due to a mismatch in GSTR-3B/9 and GSTR-2A. The petitioner had filed detailed replies on 18.04.2024 and 24.04.2024, but the impugned order did not consider these responses adequately, leading to a cryptic decision (paragraphs 1-5). The Show Cause Notice was based on an audit observation indicating a mismatch in ITC availed by the petitioner. The petitioner provided a detailed reply to this observation, but the impugned order dismissed the response as unsatisfactory, alleging that relevant documents were not furnished. The court found this reasoning unsustainable as the petitioner had submitted detailed replies with supporting documents, indicating a lack of proper consideration by the Proper Officer (paragraphs 6-8). Moreover, the petitioner argued that the reference to an audit observation in the impugned order was erroneous since no audit was conducted on the petitioner as per Section 65 of the Act. The court agreed that the audit reference appeared to be cryptic and possibly related to an audit of the GST Department itself, further undermining the validity of the impugned order (paragraph 9). Consequently, the court set aside the impugned order and remitted the Show Cause Notice to the Proper Officer for re-adjudication. The petitioner was granted 30 days to file a further reply, and the Proper Officer was directed to conduct a fresh adjudication with a personal hearing and issue a speaking order within the prescribed period under the Act. The court clarified that it did not comment on the merits of the parties' contentions, reserving all rights and contentions for future proceedings (paragraphs 10-13).
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