WFB Baird and Company India Private Limited Vs State Tax Officer (Madras High Court)
The Madras High Court considered writ petitions challenging an assessment order dated 08.12.2023 passed under Section 74 of the applicable GST enactments and an order dated 06.01.2026 rejecting the petitioner’s application under Section 128A.
The petitioner contended that the show cause notice dated 29.09.2023 had been issued under Section 73 and did not contain, either expressly or in substance, the ingredients required for proceedings under Section 74. It was further submitted that while the summary order described the order as one under Section 73, the detailed order referred to Section 74 and imposed a penalty of 100%. According to the petitioner, the rejection of the application under Section 128A followed from the treatment of the assessment as one under Section 74.
The Government Counsel submitted that an application under Section 128A is not maintainable in relation to an order issued under Section 74.
Upon examining the show cause notice, the Court found that it had been issued under Section 73 and dealt with three defects. Defect No. 3 had been dropped entirely, defect No. 2 had been confirmed only to a limited extent, and the principal tax demand related to defect No. 1 concerning reversal of excess input tax credit (ITC). The Court observed that the show cause notice merely compared the ITC claimed in GSTR-3B with the ITC available in GSTR-2A and contained nothing indicating fraud, wilful misstatement, or suppression of facts with intent to evade tax.
