Case Law Details
Chemrow India Private Limited Vs Commissioner of Delhi Goods And Service Tax And Others (Delhi High Court)
In a recent judgment, the Delhi High Court addressed the issue of the non-application of mind by the Proper Officer in a case involving the reversal of erroneously availed Input Tax Credit (ITC) TRAN-I. The court’s decision highlights the importance of proper consideration of taxpayer responses and directs re-adjudication on the matter.
The petitioner challenged the order dated 30.12.2023, which disposed of the Show Cause Notice proposing a demand against the petitioner under Section 73 of the Central Goods and Services Tax Act, 2017. The court noted that while the petitioner had submitted a detailed reply dated 10.10.2023, the impugned order did not adequately consider this response. Despite the petitioner providing supporting documents and addressing each issue raised in the Show Cause Notice, the Proper Officer deemed the reply incomplete and confirmed the demand of tax and interest.
Furthermore, the court observed that the rectification order dated 30.03.2024 failed to address the petitioner’s plea regarding the duplication of Input Tax Credit (ITC) in TRAN-1. The petitioner had asserted that the ITC was erroneously taken twice and duly reversed in the subsequent financial year with interest. However, this contention was not considered by the Proper Officer.
Consequently, the Delhi High Court set aside the impugned order and remitted the Show Cause Notice to the Proper Officer for re-adjudication. The court directed the Proper Officer to consider the petitioner’s reply on merits, provide an opportunity for clarification or further documentation if needed, and pass a fresh speaking order in accordance with the law.
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