A division bench of the Delhi High Court has held that the GST department cannot issue a fresh notice during the pendency of the proceedings under section 73 and 74 of the Goods and Services Tax Act, 2017.
Justice Jyoti Singh and Justice Anoop Kumar Mendiratta was considering a petition filed by Mr. Abhishek Gumber wherein the petitioner was aggrieved by a notice issued. The petitionetr contended that under the provisions of CGST Act, 2017, show cause notice for a particular cause of action can be issued either under Section 73 or Section 74 of the said Act and once a show cause notice is issued and adjudicated under Section 74, no notice can be issued for the same cause of action under Section 73 of the Act.
A notice dated 26.04.2022 was issued under Section 74 of the Act, to the Petitioner in the form of GST DRC-08, wherein he was called upon to show cause as to why the alleged bogus ITC for July, 2022 to December, 2022 for Rs.89,66,088/- be not reversed under Section 74 of the Act read with Rule 50(3) of the CGST Rules, 2017.
The division bench observed that “the notice was adjudicated up on and the matter was decided partly in favor of the Petitioner, pursuant to which no demand was raised in the Refund Sanction/Rejection Order dated 18.05.2022. While the Petitioner has assailed part of the order by an appeal, the Respondent has not filed any appeal and it is thus not open to issue the impugned Demand Notice on the same cause of action under Section 73 of the Act.”
Issuing notice to the department, the Court has granted stay on the impugned Demand Notice dated 02.06.2022 till the next date of hearing.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan AdFree. Follow us on Telegram for quick updates.
