Typographical Error in SCN Not Fatal, But Taxpayer Entitled to Fresh Adjudication

Facts of the Case

• The petitioner challenged an order dated 21.01.2026 passed under Section 74A of the CGST Act.
• The department alleged wrongful availment of ITC on purchases made from M/s. Rabin Traders during May 2024.
• A demand of tax, interest and penalty amounting to ₹7,19,820 was confirmed.
• The petitioner did not file any reply to the Show Cause Notice dated 15.07.2025.
• The petitioner contended that the Show Cause Notice incorrectly mentioned the tax period as FY 2020-21.
• The petitioner also stated that the disputed ITC was reflected in GSTR-2A and GSTR-2B.

Defence of the Petitioner

• The Show Cause Notice contained a typographical error regarding the tax period, creating confusion.
• The ITC was supported by valid tax invoices.
• The ITC was reflected in GSTR-2A and GSTR-2B.
• The supplier had allegedly paid the corresponding GST.
• The petitioner claimed that officials had orally informed them that the proceedings would be dropped.
• Reliance was placed on various High Court and Supreme Court judgments holding that bona fide purchasers should not be denied ITC when tax has been paid by the supplier.

Defence of the Department

• The detailed table attached to the Show Cause Notice clearly contained invoice details relating to May 2024.
• The supplier’s GSTIN, invoice numbers, invoice dates and tax amounts were specifically mentioned.
• Therefore, the petitioner was fully aware of the allegations despite the typographical error.
• Since no reply was filed, the adjudicating authority was justified in confirming the demand.

Findings of the Court

• The Court held that the Show Cause Notice did contain a typographical error regarding the tax period.
• However, the invoice-wise details in the notice clearly identified the transactions under dispute.
• The petitioner ought to have filed a reply instead of remaining silent.
• No procedural irregularity or illegality was found in the adjudication process.
• Nevertheless, the Court considered that the petitioner had not been given an opportunity to establish its case on merits regarding the disputed ITC.

Decision of the Court

• The Court did not set aside the proceedings on merits.
• The matter was remanded to the adjudicating authority for fresh adjudication.
• The petitioner was directed to:
  • Deposit 10% of the disputed tax, and
  • File a detailed reply within 30 days.
• Upon compliance, the authority was directed to pass a fresh order after considering the petitioner’s submissions.
• In case of non-compliance, the writ petition would stand dismissed automatically and the department would be free to recover the demand.

Relevance to ITC Disputes

• The judgment recognizes that ITC disputes involving alleged non-genuine suppliers require examination of facts and evidence.
• Reflection of ITC in GSTR-2A and GSTR-2B is a relevant factor that must be considered by the adjudicating authority.
• Demand cannot be sustained merely because allegations are made against the supplier without considering the recipient’s defence.
• The case supports the principle of granting adequate opportunity of hearing before denying ITC.