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Case Law Details

Case Name : Svelte Furnitures Private Limited Vs Sales Tax Officer, Delhi & Anr. (Delhi High Court)
Appeal Number : W.P.(C) 13964/2023
Date of Judgement/Order : 21/02/2024
Related Assessment Year :

Svelte Furnitures Private Limited Vs Sales Tax Officer, Delhi & Anr. (Delhi High Court)

Introduction: The case of Svelte Furnitures Private Limited vs. Sales Tax Officer Class II AVATO Ward 95 Delhi & Anr. before the Delhi High Court unfolds a crucial judgment regarding a demand created under Section 73 of the Central Goods and Services Tax Act, 2017 (CGST Act). This article delves into the court’s ruling, emphasizing the necessity for proper adjudication procedures in GST matters.

Detailed Analysis: The petitioner contested two show cause notices dated 06.09.2023 and 29.09.2023, alleging deficiencies and lack of conformity with the law. Despite the withdrawal of one notice, the other was adjudicated upon, resulting in a demand against the petitioner. However, the court observed that the order lacked consideration of the petitioner’s detailed reply, rendering it unsustainable.

The court emphasized the principle of natural justice, highlighting the failure of the proper officer to duly consider the comprehensive response submitted by the petitioner. Consequently, the court ordered re-adjudication of the matter, directing the proper officer to meticulously evaluate the petitioner’s reply and provide an opportunity for personal hearing within four weeks.

Furthermore, the court left the issue of jurisdiction and validity of the remaining show cause notice open for further examination, ensuring procedural fairness and legal scrutiny. The judgment underscores the significance of adherence to procedural norms and the principles of natural justice in GST adjudication processes.

Conclusion: The Delhi High Court’s directive in the case of Svelte Furnitures Private Limited vs. Sales Tax Officer Class II AVATO Ward 95 Delhi & Anr. underscores the importance of procedural integrity and adherence to natural justice principles in GST matters. By mandating re-adjudication and emphasizing the consideration of the petitioner’s detailed reply, the court upholds fairness and transparency in tax administration. This decision reaffirms the judiciary’s role in safeguarding the rights of taxpayers and ensuring due process in legal proceedings.

FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT

1. Issue notice. Notice is accepted by the learned counsel appearing for the respondent. With the consent of the parties, the petition is taken up for hearing today. Next date of 18.03.2024 is cancelled.

2. Original record of hearing on the Show Cause Notice has been produced in Court and the same has been perused.

GST order lacking consideration of petitioner's detailed reply is unsustainable

3. Petitioner impugns Show Cause Notice dated 06.09.2023 as also second Show Cause Notice dated 29.09.2023 seeking to create a demand under Section 73 Central Goods and Services Tax Act, 2017. The case of the petitioner is that the Show Cause Notices are bereft of any details and are not in inconsonance with law. Reference may be had to order dated 15.12.2023 whereby the Show Cause Notice dated 09.2023 has been withdrawn by the department and only Show Cause Notice dated 29.09.2023 was to be adjudicated.

4. Learned counsel for respondent informs that by order dated 31.12.2023, said Show Cause Notice has also been adjudicated upon and an order passed. Copy of the order has been placed on record by learned counsel for the petitioner along with CM APPL. 3413/2024.

5. Perusal of order dated 31.12.2023 shows that the demand has been created against the petitioner holding that the reply filed by the petitioner was non comprehensive and was not supported by sufficient document and the tax payer could not explain/justify its reply.

6. Reference may be had to the reply filed by the petitioner to the Show Cause Notice which shows that the reply is a detailed comprehensive reply adverting to each of the points raised in the Show Cause Notice.

7. Ex-facie it is apparent that the proper officer has not taken into consideration the reply filed by the petitioner while passing the cryptic order dated 31.12.2023. Consequently, we are of the view that the order dated 31.12.2023 cannot be sustained and is accordingly set The matter is remitted to the proper officer to re-adjudicate the Show Cause Notice dated 29.09.2023 by taking into account the detailed reply filed by the petitioner thereto. In case any further detail or clarification is required from the petitioner, the proper officer shall intimate the petitioner qua the same and petitioner shall thereafter promptly furnish his explanation /reply/document to this query, if any raised.

8. The proper officer shall pass a speaking order after giving an opportunity of a personal hearing to the petitioner within four weeks.

9. The issue of jurisdiction as well as validity of the Show Cause Notice dated 29.09.2023 is left open.

10. Needless to state, in case petitioner is still aggrieved by any order, petitioner shall be entitled to avail of such remedy as may be available in law.

11. Petition is accordingly disposed of in the above terms.

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