Central Goods and Services Tax Act, 2017, Section 73
Determination of tax--Order
passed without considering reply submitted by assessee--Validity of
Conclusion: Where
revenue passed assessment order against the assessee without considering reply
submitted by it, the said order was cryptic.
Revenue issued show cause notice and passed order under
section 73 of the Act. The assessee submitted that a detailed reply was filed
to the show cause notice, however, the impugned order did not take into
consideration the reply submitted by it and was a cryptic order. Held: The
observation in the impugned order was not sustainable for the reason that the
reply filed by the assessee was a detailed reply. Proper Officer had to at
least consider the reply on merits and then form an opinion whether the reply was
not satisfactory. He merely held that the reply was not satisfactory, which ex
facie showed that the Proper Officer did not apply his mind to the reply
submitted by the assessee. Further, if the Proper Officer was of the view that
reply was not satisfactory and further details were required, the same could
have been specifically sought from the assessee. However, the record did not
reflect that any such opportunity was given to the assessee to clarify its
reply or furnish further documents/details. Accordingly, the impugned order was
set aside and the matter was remitted to the Proper Officer for
re-adjudication.
Decision: In favour
of assessee by way of remand
IN THE DELHI HIGH COURT
SANJEEV SACHDEVA & RAVINDER DUDEJA
Balaji Medical & Diagnostic Research Centre v.
UOI & Ors.
W.P.(C) No. 3340/2024 & CM Appls.
13754-55/2024
5 March, 2024
Petitioner by: Harsh
Makhija, Advocate.
Respondents by: Rajeev
Aggarwal, ASC for R-1 and 4. Jitesh Vikram Srivastava, SPC and Prajesh Vikram
Srivastava, Advocate. Aditya Singla, SSC for CBIC with Anand Pandey, Advocate.
Sanjeev Sachdeva, J.
Petitioner impugns order dated 27-12-2023, whereby the
impugned Show Cause Notice dated 23-9-2023, proposing a demand against the
petitioner has been disposed and a demand of Rs. 3,09,18,988.00 including
penalty has been raised against the petitioner. The order has been passed under
section 73 of the Central Goods and Services Tax Act, 2017 (hereinafter
referred to as the Act).
2. Learned counsel for
Petitioner submits that a detailed reply dated 23-10-2023 was filed to the Show
Cause Notice, however, the impugned order dated 27-12-2023 does not take into
consideration the reply submitted by the petitioner and is a cryptic order.
3. Perusal of the Show Cause
Notice shows that the Department has given separate headings under declaration
of output tax, excess claim Input Tax Credit [ ITC ], under declaration of
ineligible ITC and ITC claim from cancelled dealers, return defaulters and tax
nonpayers. To the said Show Cause Notice, a detailed reply dated 23-10-2023 was
furnished by the petitioner giving full disclosures under each of the heads.
4. The impugned order,
however, after recording the narration, records that the reply uploaded by the
taxpayer is not satisfactory. It merely states that And whereas, in
response to the DRC-01, the Taxpayer submitted his reply in Form DRC-06. The
reply of the registered person as well as data available on GST Portal have
been checked/examined and the submission of the Taxpayer was not found
satisfactory. The Proper Officer has opined that the reply is
unsatisfactory.
5. The observation in the
impugned order dated 27-12-2023 is not sustainable for the reasons that the
reply filed by the petitioner is a detailed reply. Proper Officer had to at
least consider the reply on merits and then form an opinion whether the reply was
not satisfactory. He merely held that the reply is not satisfactory which ex-
facie shows that Proper Officer has not applied his mind to the reply submitted
by the petitioner.
6. Further, if the Proper
Officer was of the view that reply was not satisfactory and 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.
7. In view of the above, the
order cannot be sustained, and the matter is liable to be remitted to the
Proper Officer for re-adjudication. Accordingly, the impugned order dated
27-12-2023 is set aside. The matter is remitted to the Proper Officer for
re-adjudication.
8. As noticed hereinabove,
the impugned order records that petitioner has not furnished the requisite
details. Proper Officer is directed to intimate to the petitioner
details/documents, as maybe required to be furnished by the petitioner.
Pursuant to the intimation being given, petitioner shall furnish the requisite
explanation and documents. Thereafter, the Proper Officer shall re-adjudicate
the Show Cause Notice after giving an opportunity of personal hearing and shall
pass a fresh speaking order in accordance with law within the period prescribed
under section 75(3) of the Act.
9. It is clarified that this
Court has neither considered nor commented upon the merits of the contentions
of either party. All rights and contentions of parties are reserved.
10. The challenge to Notification
No. 9 of 2023 with regard to the initial extension of time is left open.
11. Petition is disposed of
in the above terms.