Delhi High Court
Canara Bank vs Assistant Commissioner, Dgst on 2 April, 2024
Author: Sanjeev Sachdeva
Bench: Sanjeev Sachdeva
$~59
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Judgment delivered on: 02.04.2024
+ W.P.(C) 4689/2024 & CM APPL. 19233-34/2024
CANARA BANK ..... Petitioner
versus
ASSISTANT COMMISSIONER, DGST ..... Respondent
Advocates who appeared in this case:
For the Petitioner: Mr. G. Shivadass, Senior Advocate with Mr.
Prashanth Shivadass, Mr. Devashish Marwah, Mr.
Rishabh and Mr. Sampath, Advocates
For the Respondents: Mr. Rajiv Aggarwal, ASC with Ms. Samridhi Vats,
Advocate
CORAM:-
HON'BLE MR. JUSTICE SANJEEV SACHDEVA
HON'BLE MR. JUSTICE RAVINDER DUDEJA
JUDGMENT
SANJEEV SACHDEVA, J. (ORAL)
1. Petitioner impugns order dated 26.12.2023, whereby the
impugned Show Cause Notice dated 25.09.2023, proposing a demand
of Rs.20,07,15,517.00 against the Petitioner has been disposed of and
a demand 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 Petitioner had filed
a detailed reply dated 19.10.2023, however, the impugned order dated
26.12.2023 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 i.e., excess claim Input Tax Credit
["ITC"]; under declaration of ineligible ITC; ITC be reversed on non-
business transactions and exempt supplies; under declaration of
ineligible ITC and ITC claimed from cancelled dealers, return
defaulters and tax nonpayers. To the said Show Cause Notice, a
detailed reply 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 incomplete, not duly
supported by adequate documents, not clear and unsatisfactory. It
merely states that "On the basis of reply uploaded by the taxpayer, it
has been observed that the same is incomplete, not duly supported by
adequate documents and unable to clarify the issue. As such, taxpayer
is not entitled to get benefit on the basis of its plain reply which is not
supported with proper calculations/reconciliation and relevant
documents. Since, the reply filed is not clear and satisfactory, the
demand of tax and interest conveyed via DRC-01 is confirmed, with
the direction to deposit the amount mentioned in DRC- 07 within one
month from the date of receipt of this demand notice, failing which
recovery proceedings u/s 79 of CGST Act will be initiated and the
actions as per law will be initiated without further reference." The
Proper Officer has opined that the reply is not clear and
unsatisfactory.
5. The observation in the impugned order dated 26.12.2023 is not
sustainable for the reasons that the reply dated 19.10.2023 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 clear and unsatisfactory 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 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.
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 26.12.2023 is set aside and the
matter is remitted to the Proper Officer for re-adjudication.
8. As noticed hereinabove, the impugned order records the reply
furnished by the Petitioner is incomplete, not duly supported by
adequate documents, not clear and unsatisfactory. 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.
SANJEEV SACHDEVA, J
APRIL 2, 2024/'rs' RAVINDER DUDEJA, J
