Case Law Details
Canara Bank Vs Assistant Commissioner (Delhi High Court)
The Delhi High Court recently addressed the petition of Canara Bank challenging an order dated 26th December 2023, concerning a show cause notice proposing a substantial demand against the petitioner under Section 73 of the Central Goods and Services Tax Act, 2017 (CGST Act). The court directed re-adjudication due to the improper handling of the petitioner’s reply by the Proper Officer.
Canara Bank contended that despite submitting a detailed reply dated 19th October 2023, the impugned order failed to consider the reply and was rendered in a cryptic manner. The petitioner provided comprehensive disclosures under various heads mentioned in the show cause notice, covering aspects such as excess claim Input Tax Credit (ITC), under-declaration of ineligible ITC, and ITC claimed from canceled dealers, among others.
However, the impugned order dismissed the petitioner’s reply as incomplete, unsupported by adequate documents, and unsatisfactory. It directed the petitioner to deposit the demanded amount without properly considering the submitted reply. The court found this approach unsustainable, highlighting the Proper Officer’s failure to analyze the reply on its merits and the absence of specific requests for further details from the petitioner.
Consequently, the court set aside the impugned order and remitted the matter to the Proper Officer for re-adjudication. It directed the Proper Officer to seek specific details/documents from the petitioner if deemed necessary and allowed the petitioner to furnish explanations and documents accordingly. The Proper Officer was instructed to conduct a fresh adjudication, including a personal hearing, and issue a new speaking order within the prescribed period under Section 75(3) of the CGST Act.
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