Aarya Metals & Ors. Vs State of Gujarat & Anr. (Gujarat High Court)
Summary: The Gujarat High Court allowed the writ petition challenging an order passed under Section 74(1) of the Central Goods and Services Tax Act, 2017 (CGST Act), which sought recovery of Input Tax Credit (ITC) of Rs.7,63,026/- along with applicable interest under Section 50. The respondents alleged that inward supplies received from M/s.RK Battery and Scrap were non-genuine because the supplier was found to be a non-genuine and non-existent taxpayer, and consequently the ITC was alleged to be inadmissible under Section 16(2) of the CGST Act.
The petitioners contended that neither the show-cause notice dated 04.08.2024 nor the subsequent reminders specified the date, time or venue of personal hearing. Three reminders dated 12.09.2024, 07.11.2024 and 18.11.2024 were issued, after which the petitioners filed a reply dated 21.11.2024 along with tax invoices issued by the supplier. The impugned order dated 07.12.2024 was thereafter passed in FORM GST DRC-07. The petitioners also contended that the order was a non-speaking, one-line order.
The respondents submitted that three reminders had been issued and that the petitioners had selected “No” in the column relating to personal hearing in their reply. They therefore contended that the petitioners were aware of the proceedings and the writ petition did not deserve to be entertained.
