Alleged Excess ITC Claim: Delhi HC quashes Penalty Order for Non-consideration of GSTR-2A and Reply, Remands SCN for Readjudication [Read Order]

In a recent decision, the Delhi High Court has set aside an order concerning an alleged excess claim of Goods and Services Tax ( GST ) Input Tax Credit( ITC ) for the financial year 2018-2019.

The petitioner challenged the order dated March 15, 2024, which was issued without considering the reply submitted by the petitioner on March 10, 2024.

The petitioner’s counsel, Parveen Kumar Gambhir, along with Rakesh Kumar and  Akul Mangla, argued that the petitioner had provided evidence through Form GSTR-2A, GSTR-8A, and GSTR-9, demonstrating no excess ITC claim. However, this evidence was not reviewed by the Proper Officer.

The respondent’s counsel, Avishkar Singhvi, ASC, with Shubham Kumar, Naven Ahmed, and Vivek Kumar Singh accepted the notice for the respondents.

The  Division Bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja noted that, “We have been taken through Form GSTR-2A, as available on the portal and from it prima facie appears that the same has not been carefully examined by the Proper Officer. In view thereof, we are of the view that the impugned order calls for a remit.”

Accordingly, the impugned order was set aside by the Bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja. The Show Cause Notice was restored on the file of the Proper Officer to re-adjudicate in accordance with law after examining the reply filed by the Petitioner and after giving an opportunity of personal hearing to the Petitioner within the period prescribed under Section 75(3) of the Goods and Services Tax Act, 2017.

In short, the Delhi High Court Division Bench had found that the Proper Officer had not carefully examined the submitted forms.  In result, the impugned order was set aside.

To Read the full text of the Order CLICK HERE

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