Case Law Details
Knowledge Infrastructure Systems Pvt Ltd Vs Union of India & Ors (Delhi High Court)
The case of Knowledge Infrastructure Systems Pvt Ltd Vs Union of India & Ors before the Delhi High Court revolves around a dispute regarding a demand of tax and penalty under the Central Goods and Services Tax Act, 2017. The petitioner challenges an order where a substantial demand was raised against them, contending that their detailed reply to the Show Cause Notice was not considered adequately.
The petitioner, Knowledge Infrastructure Systems Pvt Ltd, raised objections against the demand raised by the Department under Section 73 of the CGST Act, 2017. They argued that their reply to the Show Cause Notice, submitted on 08.12.2023, was comprehensive and addressed the issues raised. However, the impugned order dated 30.12.2023 dismissed their reply as unsatisfactory, citing reasons such as incompleteness and lack of proper documentation.
The Delhi High Court scrutinized the contentions of both parties. It observed that the Department’s decision to confirm the demand without adequately considering the petitioner’s reply was unsustainable. The court emphasized that the Proper Officer should have evaluated the reply on its merits before reaching a conclusion. Furthermore, if further details or documents were needed, the petitioner should have been given the opportunity to provide them.
The court found fault with the process followed by the Proper Officer and directed a remittance of the matter for re-adjudication. It instructed the Proper Officer to intimate the petitioner about any specific details or documents required for re-evaluation. The petitioner was granted the opportunity to furnish additional explanation and documents, following which the Proper Officer was mandated to re-adjudicate the matter and pass a fresh order within the prescribed timeline.
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