Balaji Medical and Diagnostic Research Centre vs Union of India

The learned counsel for the Petitioner argued that despite submitting a detailed reply on 23rd October 2023 to the Show Cause Notice, the subsequent order dated 27th December 2023 did not take into account the petitioner’s response and was issued in a cryptic manner.

Examining the Show Cause Notice, it was found that the Department had categorized the alleged discrepancies under different headings such as declaration of output tax, excess claim Input Tax Credit (ITC), under-declaration of ineligible ITC, and ITC claim from canceled dealers, return defaulters, and tax non-payers. The petitioner had provided comprehensive disclosures under each category in their reply.

However, the impugned order merely stated that the petitioner’s reply was not satisfactory without providing any detailed reasoning or analysis. This lack of substantive evaluation indicates that the Proper Officer did not adequately consider the petitioner’s response.

Furthermore, if the Proper Officer deemed the reply insufficient, they should have requested further details or clarification from the petitioner. However, there is no record of such communication or opportunity being provided.

Considering these shortcomings, the court concluded that the impugned order cannot stand and remitted the matter back to the Proper Officer for re-adjudication. The Proper Officer is instructed to communicate to the petitioner any specific details or documents required and provide them with an opportunity to furnish explanations and additional documents. Subsequently, the Proper Officer must re-evaluate the Show Cause Notice, conduct a personal hearing if necessary, and issue a new order within the prescribed period.

It’s important to note that the court did not express any opinion on the merits of either party’s arguments, preserving their rights and contentions for further proceedings.

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BALAJI MEDICAL AND DIAGNOSTIC RESEARCH CENTRE