Matter to Be Remanded as Assessee Wasn’t Given Opportunity to Prove Eligibility of ITC Before Tax Recovery

Case Details: R. L. Enterprises v. Commissioner state goods and services tax Delhi - [2024] 167 taxmann.com 406 (Delhi)

Judiciary and Counsel Details

• Vibhu Bakhru & Sachin Datta, JJ.
• Ruchir Bhatia & Abhishek Anand, Advs. for the Petitioner.
• Avishkar Singhvi, ASC & Naved Ahmed, Adv. for the Respondent.

Facts of the Case

The petitioner received a show cause notice (SCN) alleging that it had wrongfully availed Input Tax Credit (ITC) on basis that the registration of certain suppliers from whom the petitioner had availed the supplies, was cancelled. It submitted reply to SCN but the adjudicating authority passed an order demanding reversal of ITC without considering its reply. It filed writ petition against the order.

High Court Held

The Honorable High Court noted that the petitioner had submitted reply to SCN and contended that at the material time the suppliers from whom the petitioner had availed the supplies were registered under the CGST Act and the SGST Act. However, it appears that said contention has not been examined by the adjudicating authority as the impugned order does not reflect any such consideration.

Therefore, the Court held that the impugned order was liable to be set aside and the matter was remanded to the adjudicating authority to decide afresh. Also, the Court granted one more opportunity to the petitioner to file all documents and material in support of its contention that it was entitled to avail ITC. The adjudicating authority was directed to pass the order afresh after affording the petitioner an opportunity of being heard.