Pasricha Enterprises Through Its Proprietor Mr. Deepak Pasricha vs. The Commissioner Delhi Goods And Services Tax And Ors

Facts

The petitioner, Pasricha Enterprises, challenged an order dated December 29, 2023, which confirmed a demand of Rs. 32,07,115.80, including penalty, against them. This demand arose from a show cause notice dated September 26, 2023, issued under Section 73 of the Central Goods and Services Tax Act, 2017. The petitioner had filed a detailed reply to the show cause notice on December 13, 2023. However, the impugned order stated that the reply was unsatisfactory and devoid of merits, without detailing specific reasons or considering the petitioner's submissions. The order also noted that the petitioner or their representative did not appear for a personal hearing, despite opportunities being given.

Held

The Court held that the impugned order dated December 29, 2023, was not sustainable. The Court found that the Proper Officer had failed to consider the petitioner's detailed reply on its merits. The observation that the reply was unsatisfactory and devoid of merits, without any justification or proper reconciliation, indicated that the Proper Officer had not adequately examined the submissions. The Court also noted that if the Proper Officer believed the reply was incomplete, they should have sought further details or clarification from the petitioner, an opportunity that was not provided. Consequently, the Court set aside the impugned order and remitted the matter back to the Proper Officer for re-adjudication. The Proper Officer was directed to intimate the petitioner of any required details or documents within one week, after which the petitioner would have one week to furnish them. The Proper Officer would then re-adjudicate the show cause notice within two weeks, providing an opportunity for a personal hearing. The Court explicitly stated that it had not commented on the merits of either party's contentions.

Key Issues

1. Whether the impugned order dated December 29, 2023, passed under Section 73 of the Central Goods and Services Tax Act, 2017, is sustainable in law, considering the petitioner's detailed reply dated December 13, 2023, was not adequately considered. Petitioner's contention: The petitioner argued that their reply was detailed and provided full disclosures under each head mentioned in the show cause notice. They contended that the impugned order was cryptic, merely stating the reply was unsatisfactory without proper consideration of its merits. The petitioner further argued that if the reply was incomplete, the Proper Officer should have sought further clarification or documents, which was not done. The petitioner relied on the principle that a proper officer must consider a reply on merits before forming an opinion. Revenue's contention: The judgment does not record any specific arguments made by the revenue or respondents.