The Delhi High Court has set aside an order passed by the Adjudicating Authority under Section 73(9) of the Central Goods and Services Tax ( CGST ) Act, 2017 and the Delhi Goods and Services Tax Act ( DGST ), 2017 for not providing adequate reasons for rejecting the petitioner’s response to a Show Cause Notice ( SCN ).
The petitioner, M/s Avantha Holdings Limited, challenged an order dated 29.04.2024 issued by the Adjudicating Authority following a Show Cause Notice dated 30.01.2024. The SCN demanded additional payment for ‘unbilled revenue.’ The petitioner responded, asserting that it had already paid the necessary taxes and interest for the ‘unbilled revenue’ and provided detailed documentation to support this claim.
The bench of Justice Vibhu Bakhru and Justice Sachin Datta noted that the Adjudicating Authority’s order did not provide any substantial reason for rejecting the petitioner’s explanation. The order merely stated that the petitioner’s reply was received but deemed “not acceptable being incomplete/not duly supported by adequate documents / without proper justification and thus unable to clarify the issue.”
The bench observed that the Adjudicating Authority had not properly considered the petitioner’s response and had failed to give any reasoned explanation for its rejection. Consequently, the court set aside the impugned order and remanded the matter back to the Adjudicating Authority for fresh consideration.
The court directed that the Adjudicating Authority must pass a speaking order after giving the petitioner an opportunity to be heard. Additionally, the Authority may call for any other documents or materials deemed necessary for adjudicating the SCN.
The petitioner was represented by Arjun Raghavendra M, Dr. Gokul Kishore, A R Hema, and Piyush Deshpande. The respondent was represented by Udit Malik, ASC, and Vishant Chanda.
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